• Time to Apply for a National Provider Identifier
  • February 1, 2007
  • Law Firm: Pepper Hamilton LLP - Philadelphia Office
  • Less than six months remain until the May 23, 2007, National Provider Identifier (NPI) compliance date; at which time physicians, other health care professionals and payers are expected to be using NPIs in connection with the electronic transmission of all transactions covered by HIPAA.

    Electronic transmissions include all media (such as magnetic tape, disks and CDs), the Internet, extranets, leased lines, dial-up lines and private networks. With the compliance date quickly approaching, now is the time for health care providers and payers to apply for, secure and begin using NPIs, or risk experiencing delays in payment or denial of reimbursement for some claims. Accordingly, the Centers for Medicare and Medicaid Services (CMS) have adopted the slogan: “Getting an NPI is free – not having one can be costly.”

    The NPI is a unique identification number for health care providers that will be used by all health plans. Anyone who uses standard electronic transactions, such as electronic claims, eligibility verifications, claims status inquiries and/or claim attachments, will be required to include NPIs on electronic transactions no later than the compliance date. This includes physicians and other practitioners; physician/practitioner groups; institutions such as hospitals, laboratories, and nursing homes; organizations such as health maintenance organizations; and suppliers such as pharmacies and medical supply companies. This does not include health industry workers, such as admissions and billing personnel, housekeeping staff and orderlies, who support the provision of health care but do not provide health care services.

    Section 1173 of the HIPAA Administrative Simplification regulations mandated the adoption of “a standard unique health identifier for each individual employer, health plan, and health care provider for use in the health care system.” The stated purpose of this mandate is to improve the efficiency and effectiveness of the electronic transmission of health information. Historically, health plans have assigned identification numbers to each health care provider with whom they conduct electronic business. Providers who do business with multiple health plans have multiple identification numbers assigned by different plans, and frequently, even within the same health plan. Employers, providers, payers, clearinghouses, patients and vendors experience unnecessary confusion, higher costs, increased workload and processing delays as a result. The NPI is intended to alleviate these problems by ensuring that each provider has only one unique identifier to be used in transactions with all health plans.

    Securing an NPI is a straightforward and convenient process. Follow-up tasks – which include updating internal billing systems, coordinating with billing services, vendors and clearinghouses, and testing the system with payers – are estimated to take 120 days. Health care providers apply for an NPI by using one of the following methods: (1) apply online at https://nppes.cms.hhs.gov/; (2) call the NPI enumerator at 800.465.3203 and request a paper application to complete and mail back; or (3) grant permission to a CMS-approved electronic file interchange organization to obtain an NPI for the health care provider. The application form will require certain personal information, including Social Security numbers from individual health care professionals, federal employer identification numbers and any other identifiers that health care providers have with Medicare or private insurers.

    Despite the relative ease of applying for and implementing NPIs, there is some reluctance by health care professionals to get them. For example, the American Medical Association (AMA) has expressed concern about the lack of CMS guidance regarding how personal information associated with the NPI will be accessed and controlled. Consequently, the AMA has requested that CMS remove the Social Security number requirement from claims forms.

    Similarly, the Workgroup for Electronic Data Interchange (WEDI) has requested that CMS implement a contingency plan to allow the health care industry to use old identification numbers for at least 12 months beyond the deadline. This request was made after a WEDI survey in October 2006 that indicated that many health care professionals and payers have been delayed in completing the follow-up tasks required to use NPIs by the compliance date. WEDI argues that the health care industry has underestimated the level of work required to implement the NPI. CMS has not yet responded to the AMA’s request, but has agreed to consider WEDI’s request for a year-long extension of the deadline as part of its review process.

    Notwithstanding the concerns expressed by the AMA and WEDI, and in light of the quickly approaching compliance date, health care professionals should not delay in applying for NPIs. After the initial burden of securing an NPI and completing the follow-up tasks, health care professionals may experience more effective and efficient processing and simpler electronic transmission of data.