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Philip Hardin

It’s March … do you have your NPI, yet?

If not, chances are your healthcare entity will very soon experience a disruption in Medicare payments.

The National Provider Identifier (NPI) is one of the administrative simplification standards set by the Health Insurance Portability and Accountability Act (HIPAA). The 10-digit, “intelligence-free” number will ultimately replace other legacy and proprietary identification numbers used in transactions with public and private payers.

In the past, a physician, practice or healthcare organization typically had multiple identification numbers — often with some sort of tie to a specific plan, geographic region or medical specialty. Soon, providers will only have to remember one number, but the phase-in among health plans isn’t yet complete.

Larger health plans were required to begin using NPI as a unique identifier for providers last May, and smaller plans must be in compliance by May 23.

Using the tag, “Getting an NPI is Free — Not Having One Can Be Costly,” the Centers for Medicare & Medicaid Services (CMS) has been firm in its resolve to switch over to the new system. At the beginning of March, Medicare claims without an NPI will be automatically rejected. Those with an NPI and a Medicare legacy number will also be rejected if the pair isn’t found on the Medicare NPI Crosswalk, which is a cross reference system linking the new NPI information to older provider identifiers.

“It’s imperative that a practice … an organization ... a physician … have an identifier that is common among the payer community,” explained Philip Hardin, executive vice president of provider services for Emdeon Business Services. Not only will it ultimately simplify electronic transactions, he said, but “it’s also important when assessing pay-for-performance for a provider that you be able to identify that provider across all the payers.”

Getting there, however, has not been painless.

“There have been issues with the transition. It’s not been as smooth as we would have liked to have seen,” Hardin said of frustrations that providers and payers have felt.

At the end of the day, he continued, the number-one priority for providers is making sure they are paid for their services.

He advises clients to take the necessary steps to get prepared for NPI compliance. The first order of business is for providers to thoughtfully register — as an independent physician or as an organization — with CMS to receive the new identifier number. Hopefully, at this point, most have completed that particular task.

The next step is to register the new number with any payer that requires such action. Hardin noted that most payers have made their policy on registration available online. He added that companies like Emdeon, which provides revenue cycle and clinical communications solutions, typically handle those types of tasks on behalf of clients to lessen the administrative burden.

Hardin said it is a wise precaution to roll in the use of NPI in conjunction with older identification numbers at the beginning. He counsels clients to send small batches of claims with both the NPI and legacy identifier as a test.

“Then, we’re recommending after they have done that for a period of time, they send a series of test claims with the NPI only. Once they confirm they are being paid appropriately, they can start using the NPI for all of their billing with that particular payer,” he continued.

Hardin said the purpose of the incremental approach is to ensure that cash flow isn’t negatively impacted. It’s important to understand payer-specific requirements and recognize there will be a potential for increased rejection rates — particularly in this early switchover period.

Another pitfall for providers is assuming their current software will easily transition to using the new identifier system.

“They need to be aware that just because they can send claims electronically today does not mean that method will support NPI,” he cautioned.

Luckily, the government has given the payer communities and providers some latitude to work out the kinks during a contingency period, but Hardin says there needs to be evidence of a “good faith” effort to move toward full implementation of NPI.

Hardin suggested payers should be aware of the actual usage of NPI by their provider networks when setting cut-off deadlines. While payers can legally require the full switch to NPI at any time, many have been holding back until the federal government began demanding compliance.

Based on the latest guidance from CMS, the time is at hand.

“Once CMS begins, you can expect other payers to follow closely behind,” Hardin pointed out.

For educational resources on NPI standards and how to prepare for full implementation, go online to the CMS site at www.cms.hhs.gov/nationalprovidentstand or the Workgroup for Electronic Data Interchange at www.wedi.org.

Hardin said clients of companies that provide HIPAA solutions such as Emdeon should also contact their account manager for personal guidance or to ask specific questions.



March 2008

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