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Can a supervising MD require the Nurse Practitioners he is supervising to pay in cash only? They are not located in same facili

Hickory, NC |

This MD has in the past been reported and reprimanded for selling drug samples, prescribing pain meds with no medical necessity, and had his priviledges revoked to prescribe in the past. I believe that he is commiting civil tax fraud, but do not know how to report it.

Attorney Answers 4


Unfortunately your question is not clear. Is the MD paying these nurse practitioners in cash, or is he requiring them to pay for something else in cash out of their own pocket? Also, what are the payments for? Finally, without disclosing any identifying information, what is your general relationship to the MD? Are you an employee, a patient, a co-worker, or something else?

My answer does not constitute legal advice and may not be relied upon by anyone for any purpose and does not constitute an attorney/client relationship or an offer to form such a relationship. This disclaimer is intended to be fully compliant with the requirements of Treasury Department Circular 230 and the terms thereof are fully incorporated by reference. If you wish to consult with me please contact me at dwatchley@newyorktaxcounsel or visit my website at

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Like my other colleague who responded, I am not clear on the exact issues. As a general matter, it is a violation of the federal False Claims Act to knowingly: (1) bill for tests not performed; (2) falsely represent that the doctors instead of the nurses who performed the tests; (3) use incorrect billing codes to obtain a higher reimbursements for tests or services than were performed by using doctor codes rather than less costly nurse practitioner codes; (4) up coding (inflating bills by using diagnosis billing codes that falsely claim that more expensive tests or services were performed); and (5) submit false cost reports in order to obtain higher Medicare reimbursements than permitted by using doctor codes rather than nurse practitioner codes.

If you want to know how to report this, you should consider talking with an employment law attorney familiar with these issues.

This information should not be construed to be formal legal advice nor the formation of a lawyer/client relationship.

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Too little facts to give a clear answer. But an employer can pay you in case, but it is up to the employer to report wages to the IRS (as well as FICA) and to give the employee a 1099 at the end of the year. Even if the employee does not receive a 1099, it is the employee's responsibility to report the income.

If you report the income, then you are doing what you are supposed to do. If you don't, you are committing tax fraud.

Any information is provided for educational purposes only. No attorney-client relationship exists between any person reading this information. No warranty, express or implied is provided. If you have a legal matter is important to contact an attorney who is licensed in your state. Many attorneys provide free initial consultations.

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Your question is unclear. You are licensed by the NC Board of Nursing. They require you to be supervised by an MD. Ordinarily, that means as an employee. If I understand correctly, he is paying you as a contractor without withholdings and in cash. From a tax perspective, a person in that position would be safe as long as she keeps careful records and reports the income and pays self employment tax. However, I have to wonder if BON would see that as "supervision." A person who believes she is paid improperly could file an SS-8 which is a form which asks the government to determine whether the worker is an employee or a contractor and puts them on notice that the worker is receiving compensation from that physician.

This response to a hypothetical question is for general purposes only and does not establish an attorney-client relationship between the attorney and the questioner. For specific legal advice, please contact a lawyer in your state.

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