Final answer:
The nurse should report the fraudulent billing practices under whistleblower law.
Step-by-step explanation:
The nurse's best next action is to report the fraudulent billing practices to the appropriate authorities under the Federal whistleblower law. Whistleblower laws protect employees from retaliation who report illegal or unethical activities in their workplace. In this case, the nurse has witnessed the physician submitting false bills to Medicare, which is a violation of the law.