The professional component of provider-based physicians' services includes those services directly related to the medical care of the individual patient. Services to individual patients must be billed by the physician, or, with the physician's authorization, by the provider. When such services are performed by a faculty member of a medical, osteopathic, dental or podiatry school, billing by the school with the physician's authorization is an additional alternative.

Provider-based physicians often perform professional services other than those directly related to the medical care of individual patients. These may involve teaching, administrative, and other services that benefit the provider's patients as a group. Such services, not directly related to an individual patient, if compensated, are considered in computing reimbursable provider costs. Reimbursement for such costs is made under Part A when they relate to inpatient services and under Part B when they relate to outpatient services and inpatient ancillary services when Part A benefits are not payable.