Collaborative agreements for nurse practitioners: What you need to know

Welcome to the first edition of 'The Regulatory Review," where each month, Tebra's Deputy General Counsel Nicholas Starkman breaks down the key compliance issues impacting healthcare.

The last several years brought a whirlwind of regulatory changes for Nurse Practitioners (NPs), and other non-physician practitioners. The pandemic’s drastic impact on the United States healthcare system caused many leaders to consider expanding existing pathways for patients to obtain high quality medical care. 

Into the spotlight stepped NPs to demonstrate that they too would play a pivotal role in the pandemic response. As a result, states such as California made efforts to relax regulatory requirements on NPs, including temporarily waiving certain supervisory requirements. Emerging from the pandemic, an ongoing national physician shortage continues to generate increased opportunities for NPs to bridge known gaps in access to healthcare. 

Despite this changing landscape, there is still one legal document that many NPs must be aware of, as they are likely to encounter it at some point in their career. In general, practice agreements (sometimes called collaborative agreements or collaborative practice agreements) are contracts between NPs and collaborating physicians that enable NPs to perform a wider array of medical services. Practice agreements may be required under state law, federal regulations (think Medicare requirements), or by institutions such as hospitals. 

In this post, we’ll take you through what you need to know about practice agreements and give you an overview of their key points. 

To state it simply, a practice agreement is a written document that defines the scope of medical care provided by an NP in collaboration with a licensed physician. As discussed below, a practice agreement may have different legal requirements depending on which state the providers are practicing. 

Some state authorities provide templates for the general public. You can review a New York practice agreement here and a California agreement here. Check your state’s licensing board for additional examples.  

NPs are regulated by a patchwork quilt of rules and policies that differ on a state-by-state basis. The American Association of Nurse Practitioners categorizes each state as having a practice environment labeled along a spectrum from “full practice” (meaning the least amount regulatory of restrictions), to “reduced practice”, to “restricted practice”. You can view and download the full AANP map here.  

Another setting in which NPs may encounter practice agreements is when they are meeting reimbursement requirements under Medicare. The Medicare Regulations state that “Medicare Part B covers nurse practitioners' services in all settings in both rural and urban areas, only if the services would be covered if furnished by a physician and the nurse practitioner … Performs them while working in collaboration with a physician. (Emphasis added). Collaboration under Medicare is defined as "a process by which the nurse practitioner has a relationship with one or more physicians to deliver health care services". 

In other words — even in full practice environment states — if NPs are seeking to meet reimbursement requirements, they may be required to execute a practice agreement. NPs should seek the advice of an attorney in this area in particular, as the definition of “collaboration” under state law may require reconciliation with the Medicare definition of the same. 

Governing boards of hospitals, long-term care facilities, and other institutions may also require practice agreements. One reason for this is that certain court rulings state that physicians have a duty of care over the NP’s patients where a practice agreement is in place. This duty may be more substantial, where, for example, an NP may prescribe medication under a practice agreement. In a state court case in Indiana (Collip v. Ratts ex rel. Ratts, 49 N.E.3d 607 (Ind. Ct. App. 2015)), a court ruled that a practice physician who entered into a practice agreement with an NP — under which he oversaw her authority to prescribe drugs voluntarily — undertook a duty to protect patients. Hospitals and other facilities may seek to use practice agreements to limit NPs' scope of practice in order to avoid potential liability.  

NPs have seen many changes to their regulatory landscape in the last several years, and this trend is poised to continue. Effective 2023, for example, California created 2 new categories of NPs; commonly referred to as 103 NPs and 104 NPs, they have less restrictive practice obligations than previous categories of NPs. Still, while the momentum appears to be in favor of less restrictive NP practice environments, NPs should stay abreast of their obligations under state law, their employer, and Medicare. 

Tebra is built to help independent practices — regardless of specialty — provide better care. Learn about how one nurse practitioner saw 500% new patient growth at her practice after leveraging Tebra.

Disclaimer: This information is provided as a courtesy to assist in your understanding of the impact of certain healthcare developments and should not be construed as legal advice.