Reciprocal Billing and Locum Tenens Arrangements Changes

November 26th, 2018 - Wyn Staheli, Director of Research
Categories:   Modifiers   Billing   Medicare  

There are two types of arrangements when the physician is absent for a variety of reasons (e.g., illness, vacation, medical education) and they arrange with another provider to cover the practice during their absence: reciprocal billing arrangements and Fee-For-Time compensation arrangements (sometimes referred to as locum tenens arrangements). CMS has made changes to their payment policies for these types of arrangements. Providers need to be aware of these changes and update their policies as appropriate.


Reciprocal billing describes arrangements where providers agree to cover each other's practice when the other one is absent. These are typically informal arrangements and Medicare does not require that it be documented in writing.

Fee-for-time describes arrangements where the regular provider pays the substitute provider to take over the practice on a per-diem or similar type basis. These providers are considered an independent contractor. 

Revise 'locum tenens' Wording

The following information is from MLN Matters Number MM10090:

The term “locum tenens,” which has historically been used in the manual to mean fee-for-time compensation arrangements, is being discontinued because the title of section 16006 of the 21st Century Cures Act uses “locum tenens arrangements” to refer to both fee-for time compensation arrangements and reciprocal billing arrangements. As a result, continuing to use the term “locum tenens” to refer solely to fee-for-time compensation arrangements is not consistent with the law and could be confusing to the public.

Addition of Physical Therapists

Section 16006 of the 21st Century Cures Act includes a provision which expands reciprocal billing to include physical therapists who provide physical therapy services in a health professional shortage area (HPSA,) medically underserved area (MUA,) or rural area - as defined by the Medicare Claims Processing Manual Chapter 1, Section 30.2.10. This change became effective June 13, 2017.

Modifier Changes

It should be noted that there were significant changes to modifier Q5 and modifier Q6 to facilitate the these changes. Note that changes to the code descriptions are shown in red below.

Q5 Service furnished under a reciprocal billing arrangement by a substitute physician or by a substitute physical therapist furnishing outpatient physical therapy services in a health professional shortage area, a medically underserved area, or a rural area
Q6 Service furnished under a fee-for-time compensation arrangement by a substitute physician or by a substitute physical therapist furnishing outpatient physical therapy services in a health professional shortage area, a medically underserved area, or a rural area

Tip: These modifiers are to be used with both assigned and unassigned claims.

60 Day Requirement

Services must be provided within a continuous 60 day period. There is a new provision allowing for an extension on the 60 days when the provider is called to active duty. MLM Matters Number MM10090 states:

... when a regular physician or physical therapist is called or ordered to active duty as a member of a reserve component of the Armed Forces for a continuous period of longer than 60 days, payment may be made to that regular physician or physical therapist for services furnished by a substitute under reciprocal billing arrangements or fee-for-time compensation arrangements throughout that entire period.

Billing Guidelines

The regular provider submits the “covered visit service” under his/her NPI, with the appropriate procedure code(s) and either modifier Q5 or modifier Q6 (as applicable.) Medicare payment will be made to the regular physician or physical therapist, not the substitute for the covered service.

The following example regarding billing time frames is from the Medicare Claims Processing Manual (emphasis added):

EXAMPLE: The regular physician or physical therapist goes on vacation on June 30, and returns to work on September 4. A substitute physician or physical therapist provides services to Medicare Part B patients of the regular physician or physical therapist on July 2, and at various times thereafter, including August 30 and September 2. The continuous period of covered visit services begins on July 2 and runs through September 2, a period of 63 days. Since the September 2 services are furnished after the expiration of 60 days of the period, the regular physician or physical therapist is not entitled to bill and receive direct payment for the services furnished August 31 through September 2. The substitute physician or physical therapist must either bill for the services furnished August 31 through September 2 in his/her own name and billing number or reassign payment to the person or group that bills for the services of the substitute physician or physical therapist. The regular physician or physical therapist may, however, bill and receive payment for the services that the substitute physician or physical therapist provides on behalf of the regular physician or physical therapist in the period July 2 through August 30.


Questions, comments?

If you have questions or comments about this article please contact us.  Comments that provide additional related information may be added here by our Editors.

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