Coding and Billing Basics: What FNP Exam Candidates Don't Expect

Most FNP candidates spend zero hours studying for the coding and billing questions on the exam. They figure these are "real-life skills" they'll learn on the job. The exam disagrees. About 5 to 10% of questions touch on professional role, billing, coding, scope of practice, and reimbursement.

You don't need to be a billing expert. You need to know the basics.

The exam rewards FNPs who understand how their work translates into the systems that pay for it.

ICD vs. CPT

Two completely different code systems. Don't mix them up.

• ICD-10 (International Classification of Diseases): describes the diagnosis. "Why did the patient come in?" Example: E11.9 — Type 2 diabetes without complications.
• CPT (Current Procedural Terminology): describes what was done. "What did the provider do?" Example: 99214 — established patient office visit, moderate complexity.

A claim needs at least one ICD and one CPT. The ICD justifies the CPT.

E&M Codes

The most commonly used CPT codes in primary care are Evaluation and Management (E&M) codes:

• 99202–99205: new patient office visit (level 2–5).
• 99211–99215: established patient office visit.
• 99381–99387: preventive medicine, new patient (by age band).
• 99391–99397: preventive medicine, established patient.

Level of service used to be determined by history, exam, and decision-making complexity. As of 2021, E&M coding for office visits is based on either total time or medical decision-making (MDM).

MDM Components

Three pillars:

1. Number and complexity of problems addressed
2. Data reviewed (labs, imaging, records, communication)
3. Risk of complications or morbidity

Two of three at a given level determines the code. A 99214 typically requires moderate complexity in 2 of 3 areas.

Modifiers

Common modifiers to know:

• -25: significant, separately identifiable E&M service on the same day as a procedure.
• -59: distinct procedural service.
• -95: telehealth synchronous.
• -GT: older telehealth modifier (less common now).

Incident-To Billing

This is a Medicare concept that affects NP reimbursement. Incident-to means an NP delivers a service that is billed under the supervising physician's NPI, at 100% Medicare reimbursement (compared to 85% when billed directly under the NP's NPI).

Requirements:

• Physician must establish the patient and the plan of care.
• Physician must be in the office suite when NP delivers the service.
• NP must follow the established plan.
• Incident-to is for established problems, not new patient visits or new problems.

The exam may test whether a specific scenario qualifies as incident-to.

Test Pearl: New patient visit = NEVER incident-to. New problem in established patient = NEVER incident-to.

Scope of Practice

Practice authority varies by state, divided into three categories per AANP:

• Full practice authority: NP evaluates, diagnoses, orders, manages treatment, prescribes — without physician oversight. About 27 states + DC.
• Reduced practice: Requires a collaborative agreement or one element of practice is restricted.
• Restricted practice: Requires direct supervision or delegation by another health profession.

Know whether your state is full, reduced, or restricted. The exam may reference national statistics.

DEA Registration and Controlled Substances

• NPs with prescriptive authority obtain a DEA number to prescribe controlled substances.
• Schedule I — no medical use (heroin, LSD, marijuana federally). Cannot prescribe.
• Schedule II — high abuse potential, accepted medical use (oxycodone, morphine, methylphenidate, amphetamines).
• Schedule III–V — lower abuse potential (codeine combinations, alprazolam (IV), pregabalin).
• Some states limit NP authority to prescribe schedule II.

HIPAA Basics

• Protected Health Information (PHI) cannot be disclosed without patient authorization, with some exceptions.
• Exceptions: treatment, payment, healthcare operations, public health reporting, mandatory reporting (abuse, certain diseases), court order.
• Minimum necessary rule: share only what's needed for the purpose.

Documentation Standards

• Document what was done. "If it isn't documented, it didn't happen."
• Date and sign every entry.
• Late entries should be labeled as such with the actual date.
• Don't alter records — addendums are appropriate.

Medicare and Medicaid Basics

• Medicare Part A: hospital insurance.
• Medicare Part B: outpatient/physician services.
• Medicare Part C: Medicare Advantage (managed care plans).
• Medicare Part D: prescription drug coverage.
• Medicaid: state-administered insurance for low-income individuals.
• CHIP: Children's Health Insurance Program.

How the Exam Tests This

Expect questions about incident-to, scope of practice, billing for telehealth, and basic policy. Not deep. But present. Don't skip this section in your prep.

A few well-targeted hours can earn you 5 to 10 free points.