It is not a coincidence that the first nurse practitioner program was developed during the same decade that Medicare evolved. Our country had become more urban, and large teaching hospitals became magnets for primary care physicians graduating from medical school. The rural scene was not financially alluring, and many patients who lived outside the urban and suburban areas were left without primary care physicians.

Loretta Ford, NP, and Henry Silver, MD, created the first training program for NPs in 1965. According to Ford, society's demand for primary care services and nursing's potential to meet this need were the primary reasons for the development of the NP role. The physician shortage in rural and underserved areas merely provided the opportunity. That same year saw the development of the Medicare and Medicaid programs, which provided healthcare to low-income women and children, older adults, and people with disabilities.

The Onset of RBRVS

Congress passed the Rural Health Clinic Act in 1977 to provide primary care facilities in rural and underserved areas. A criterion for Medicare and Medicaid reimbursement was the inclusion of an NP, physician assistant or nurse midwife at every rural health clinic. And voila, our niche was born.

NPs in these clinics received provider numbers and billed for services long before most states adopted third-party reimbursement laws.

There was, however, a downside. Reimbursement for NP services was set at the lesser of two amounts: 80% of the prevailing fee for the particular service or 85% of the physician's fee for providing the service. This percentage was based on a system of standardized payment called the resource-based relative value scale (RBRVS). This system uses relative value units to determine the reimbursement payment scale, and it is supposed to reflect operating expenses, work experience and malpractice expenses.

NPs in most states could not practice without a collaborating or supervising physician, so NP services were considered "incident to" the physician service. Physicians had to make contact with each Medicare or Medicaid patient at some level for the payment to be made to the NP.

The Early Years

Medicare recipients are required to pay 20% of their fees, and providers are reimbursed 80% of the fees. This is known as the 80-20 rule. If an NP files a claim under her Medicare provider number, the clinic is reimbursed only 85% of the 80% permitted for billing. If the clinic bills for a visit (even one made by an NP) under the physician's provider number, however, the reimbursement rate is 100% of the 80% allowable.

It's understandable that clinics would prefer to file for reimbursement under a physician's number in every case. In the early years of Medicare, many clinics followed the guidelines and used their NPs' numbers, but many did not. As a result, the concept of cost savings using NPs was not fully realized in many areas.

Direct Reimbursement

In 1997, the Balanced Budget Act required direct reimbursement to NPs for Medicare Part B services provided in any setting, not just rural clinics. However, reimbursement amounts remained the same.

Third-party reimbursement for Medicaid had already been in place in North Carolina for 5 years, and those of us who filed under our own Medicaid provider numbers were already being reimbursed. Surely private insurers would get on the bandwagon and allow NPs on their provider panels if the government-run healthcare system did.

Of course, this did not happen. NPs are still battling to be reimbursed fairly. Certification processes differ with every insurer, and obtaining provider status with one company doesn't necessarily mean it will happen with another.

Continued Efforts Needed

NPs must continue to remain active in the legislative arena. In May 2009, representatives from all national NP organizations provided testimony at a congressional briefing on the role of the NP. They recommended that NPs be recognized and included in the reform process as primary care providers.

Meanwhile, many state NP organizations lobby for legislation promoting the NP role in primary care. We must remain a visible and viable source of primary care for all groups of patients. The reconfiguration of the tier system in primary care is, in my opinion, the answer to fair reimbursement laws in the future.

Bonnie Hill is a family nurse practitioner who owns Rowan Prime Care in Salisbury, N.C.

Action Advice

To achieve equitable reimbursement rates under Medicare and Medicaid,

> Join a national nurse practitioner organization.

> Join a state nurse practitioner organization where you practice or live.

> Contact elected officials in Congress to educate them about NPs. Explain why NPs should be reimbursed at the same rate as physicians.