National Provider Identifier

Current Status

The Final Rule adopting the HIPAA standard unique health identifier for health care providers was published in the Federal Register on January 23, 2004. Health care providers can begin applying electronically for NPIs on the effective date of the final rule, May 23, 2005 and by paper application in July, 2005. All health care providers are eligible for NPI assignment; health care providers who are covered entities must obtain and use NPIs. All HIPAA covered entities must use NPIs by the compliance dates (May 23, 2008 for small health plans).

In early Spring 2007, the Centers for Medicare and Medicaid Services (CMS) issued a contingency plan extending the deadline for full compliance with the NPI rule to May 23, 2008. The contingency does not delay the effective date of the NPI rule, but does allow covered entities to avoid possible citations if they can show they are making due diligence to becoming compliant. Under the contingency, CMS allows each payer to decide their own contingency deadline. Florida Medicaid has chosen May 23, 2008 as its contingency deadline.
NOTE: Other entities you work with, such as clearinghouses and Provider Service Networks (PSNs), may have their own NPI submission deadlines. Please check with all entities with which you contract to determine their start date for requiring inclusion of the NPI on transactions.

The NPI is an 10-position numeric identifier. It includes as the 10th position a numeric check digit to assist in identifying erroneous or invalid NPIs. The NPI format would allow for the creation of approximately 200 million unique identifiers. The Department of Health and Human Services, Centers for Medicare & Medicaid Services awarded the National Provider Identifier (NPI) Enumerator contract to FOX Systems, Inc. on February 24, 2005.

Background

In order to administer their programs, the Department of Health and Human Services, other Federal agencies, State Medicaid agencies, and private health plans assign identification numbers to the providers of health care services and supplies with which they transact business.

These various agencies and health plans assign identifiers to health care providers for program management and operations purposes. The identifiers are frequently not standardized within a single health plan or across plans. This lack of uniformity results in a single health care provider having different numbers for each program and often multiple billing numbers issued within the same program, significantly complicating providers' claims submission processes. In addition, nonstandard enumeration contributes to the unintentional issuance of the same identification number to different health care providers.

Most health plans have to be able to coordinate benefits with other health plans to ensure appropriate payment. The lack of a single and unique identifier for each health care provider within each health plan and across health plans, based on the same core data, makes exchanging data both expensive and difficult.

All of these factors indicate the complexities of exchanging information on health care providers within and among organizations and result in increasing numbers of claims-related problems and increasing costs of data processing. As we become more dependent on data automation and proceed in planning for health care in the future, the need for a universal, standard health care provider identifier becomes more and more evident.

In addition to overcoming communication and coordination difficulties, use of a standard, unique provider identifier would enhance our ability to eliminate fraud and abuse in health care programs.

• Payments for excessive or fraudulent claims can be reduced by standardizing enumeration, which would facilitate sharing information across programs or across different parts of the same program.
• A health care provider's identifier would not change with moves or changes in specialty. This facilitates tracking of fraudulent health care providers over time and across geographic areas.
• A health care provider would receive only one identifier and would not be able to receive duplicate payments from a program by submitting claims under multiple provider identifiers.
• A standard identifier would facilitate access to sanction information.