If I serve as a Collaborative Physician to an NP, can the NP pay me?

Provided by:  Jennifer Kirschenbaum, Esq.

April 14, 2022

Question:

Hi Jennifer,

If I serve as a Collaborative Physician to an NP, can the NP pay me?  

Thanks, 
Dr. P

Answer:

Yes, but...  New York Education Law and professional misconduct regulations prohibit a collaborating physician and an NP from engaging in “fee-splitting” or “kick-backs”. 

See  http://www.op.nysed.gov/prof/nurse/npcollab.htm.   The goal of these restrictions?  To ensure that medical and nursing decisions are based on sound clinical judgment, uncompromised by economic or business considerations.

The Department of Education provides further guidance by defining "kick-back" and "fee splitting", as follows:

"A “kick-back” typically occurs when a person gives or receives or agrees to give or receive any money or other consideration to or from a third party in exchange for the referral of patient services. For example, if a physician pays a NP $100 each and every time the NP refers a patient to the physician for medical care, then it is very likely that the physician is giving and the NP is receiving “kick-backs”.

“Fee splitting” can occur if an NP shares his or her practice income or fees with a physician who is not the NP’s employer. “Fee splitting” also includes arrangements or agreements in which the NP pays the collaborating physician an amount of money that constitutes a percentage of, or is otherwise dependent upon the income or receipts of the NP in exchange for the collaborating physician’s services. For example, if an NP pays 20% of the NP’s professional income to the collaborating physician (who works at a separate medical practice) in exchange for the collaborating physician’s services, the NP and the physician are probably engaging in illegal “fee splitting”." Id. 

The Education Laws prohibiting “fee-splitting” or “kick-backs” do not prohibit a NP from paying a collaborating physician the fair market value of the physician’s personal services (i.e., chart review and consultation), unless:

• the payment includes remuneration for the referral of patient services;
• the NP is required to refer patients to the physician; or
• the payment is based on a percentage of or dependent on the NP’s professional fees or income.

The NYS Department of Education offers further guidance that "NPs may refer patients to their collaborating physicians when medically necessary, provided that the NP receives nothing in exchange for the referral. New York law does not require that a collaboration agreement include a payment provision."