Are you a healthcare provider or a provider organization working in the United States? Then you must know that an inaccurate or missing NPI number is one of the most prevalent reasons for medical billing errors and refused claims. Without a proper NPI, insurance claims submitted to Medicare, Medicaid, or any other health plan will not be reimbursed.
A National Provider Identifier (NPI) number is a unique identifying number assigned to each healthcare provider and organization in the United States. As part of the Health Insurance Portability and Accountability Act (HIPAA), NPI was introduced in 1966, meant to enhance the efficiency of electronic health records. Now, every healthcare plan and organization, including the Center for Medicare and Medicaid Services (CMS), uses its NPI to manage administrative and financial transactions and process medical payments and claims.
Table of Contents
- 1 What is an NPI number?
- 2 Types of NPI numbers
- 3 What is the purpose of an NPI number?
- 4 Who needs an NPI number?
- 5 Who uses an NPI?
- 6 How to get an NPI?
- 7 Do I apply for individual NPI or as an organization?
- 8 Receiving your NPI
- 9 How do I find my NPI number?
- 10 What is the application cost of an NPI number?
- 11 HIPAA rules for NPI
- 12 Can NPI replace TIM (Tax Identification Number)?
- 13 Will my NPI number change?
- 14 Conclusion
What is an NPI number?
The National Provider Identifier (NPI) number is an administrative simplification standard used by the Health Insurance Portability and Accountability Act (HIPAA). It is a unique identification number issued to covered healthcare providers. It is an obligation for all the covered healthcare providers and clearinghouses to use NPIs for all the financial and administrative transactions incorporated under HIPAA. NPI number is a 10-digit numeric identifier that is absolutely intelligence-free. The intelligence-free number means that NPIs do not carry any other personal information about healthcare providers, such as their medical specialty or the state they live in. In HIPAA standards transactions, the NPI must be used instead of traditional provider identification.
Federal Regulation, The Health Insurance Portability and Accountability Act of 1996 (HIPAA), outlines that every covered healthcare provider must share their NPI with other healthcare providers, clearinghouses, health plans, or any other entity who needs the NPI for billing purposes. The CMS (Centres for Medicare & Medicaid Services) has created an online portal where any healthcare organization, healthcare provider, or physician can access the NPI information. This forum is a part of the National Plan and Provider Enumeration System (NPPES) website NPI registry(nppes.cms.hhs.gov). The information about healthcare providers shared on this forum covers only the data which is exposable under the Freedom of Information Act (FOIA).
The NPI number does not change throughout the entire career of the healthcare provider. NPIs are used to improve the efficiency and effectiveness of electronic health information transfer. In addition to that, NPIs can also be helpful in identifying the individual healthcare providers on the prescription, in the medical record system of the patients, and the coordination of the benefits across different health plans.
Types of NPI numbers
There are two different categories of NPI numbers: Type 1 and Type 2. Let’s see about the differences between both types.
The type-1 of the national identity provider is also called rendering NPI. This type is for healthcare providers who operate individually as a sole proprietorship. Relocating from one office to another office, having other employees, and even if those employees have Employer Identification Number (EIN) do not affect your eligibility for type-1 NPI. It is highly recommended that all healthcare providers have a type-1 NPI at the start of their careers. Rendering NPI works similar to a social security number, and it helps in the easy identification of healthcare providers.
The type-2 national identity provider is also called organizational NPI. Unlike the rendering NPI, organizational NPI requires a group of healthcare organizations or individuals. If you run a healthcare organization with multiple healthcare providers and provide CMA-1500 to your patients, it is mandatory for you to have a type-2 NPI number. This process allows the whole organization to become accredited with the insurance company and saves the trouble of undergoing the process of individual healthcare provider’s registration.
In type-2 NPIs, the reimbursements of the medical bills are usually made to the organization instead of the individual provider. Type-2 NPIs allow the insurance companies to reveal the information of the individual healthcare providers who provided the medical services and also the name of the healthcare provider organizations under which the healthcare provider works. Therefore, it is essential for the healthcare providers to provide their type-1 NPIs and the organization’s type-2 NPI number in the billing process. Otherwise, the claim will likely be rejected on the basis of incomplete information.
What is the purpose of an NPI number?
Before the final rule of NPI was published in 2004, there were other identification numbers assigned to healthcare providers and organizations. These numbers were assigned by some private healthcare plans and federal programs like Medicare and Medicaid. The procedure of issuing the identification number was not standardized. It resulted in individual providers having multiple identification numbers issued by several healthcare plans in which the provider was enrolled. The claim process was also highly complicated, resulting in several providers having the same identification number issued by different healthcare plans.
The purpose of the final rule of National Provider Identifier was to standardize the identification numbers and establish unique NPIs for healthcare providers in order to smooth the healthcare system. Implementation of this rule not only simplified the administrative process but also reduced the burden on healthcare providers.
The final rule requires the providers to use the NPI number while communicating any healthcare information associated with a healthcare transaction. The rule states. “The use of the NPI will improve the Medicare and Medicaid programs, and other Federal health programs and private health programs, and the effectiveness and efficiency of the healthcare industry in general, by simplifying the administration of the healthcare system and enabling the efficient electric transmission of certain health information.”
NPI prevents healthcare frauds
NPI not only incorporates efficiency in the standardized administrative process but also helps Medicare and Medicaid to prevent healthcare fraud. The NPI reveals the identity of the individual healthcare provider who is prescribing any medicines and treatments or ordering the drugs, supplies, and equipment. The additional verification of NPI supports the clarity in the process. NPI also keeps a check on the validity of the credentials of the individual healthcare providers. Research states that using NPI has saved the taxpayers approximately $1.6 billion in the last decade.
Who needs an NPI number?
All the individual healthcare providers, healthcare organizations, and healthcare clearinghouses working under the regulation of HIPAA must acquire an NPI number. Particularly the organizations and healthcare providers that use a medical insurance company to process their billing claims. Any healthcare organization, business, or individual service provider who electronically connects with patients and executes transactions must also have an NPI by HIPPA. Whether you are a covered provider working under HIPAA, a supplier who bills on funded programs offered by the federal government, or a healthcare provider, you must have an NPI. Enrollment with Medicare also requires the healthcare providers to have an NPI before applying.
Other than individual healthcare providers, healthcare organizations, and healthcare clearinghouses, even the dentists who are NOT working as HIPAA-covered entities may be required to use an NPI. Most dental plans demand a dentist to include their NPI numbers while making a paper claim. Medicare part D also requires the non-covered dentists to use their type-1 NPI on the prescriptions, particularly in the case of Medicare part D beneficiaries.
Moreover, an insurance plan for a pharmacy may also ask the pharmacist for the prescribing provider’s NPI number on the drug prescription. A medical specialist may also ask the patients to get a referral from a doctor with a type-1 NPI to fulfill the claim.
Getting an NPI number is not required if you are a healthcare provider who wants to practice medicine only. If you opt-out of Medicaid or Medicare and are not covered by HIPAA or do not take any kind of payments from a third party, you do not need an NPI number.
Who uses an NPI?
Here is a detailed list of HIPAA-covered organizations and providers who must use an NPI number.
- Ambulance companies
- Clinical Social Workers
- Clinical Therapists
- Group Practices
- Health care clearinghouses
- Health care plans
- Home health care agencies (HHA’s)
- Licensed Therapists
- Medical Equipment suppliers
- Medical Laboratories
- Nursing homes
- Physical therapists
- Physician Assistants
- Residential Treatment Centers
How to get an NPI?
After knowing what an NPI is and whether or not you need one, the only thing to wonder remains: How to get an NPI?
The National Plan and Provider Enumeration System (NPPES) has made the process of getting an NPI very easy to understand and follow. If you are an individual healthcare provider or a healthcare provider organization, all you have to do is visit the website of NPPES and apply for your NPI number. To support the NPIs, NPPES is in contract with Fox Systems, Inc. working as an enumerator. Fox systems, Inc. manages the processing of any provider’s NPI application, resolves issues related to NPI application, answers the frequently asked questions about NPI, and assigns the NPI numbers.
Applying for an NPI number is a simple 20 – 30 minutes procedure that will save the providers many future troubles and time. CMS has authorized the NPPES to cater to all the matters related to the NPI application process. The application process is totally free of cost.
There are three different ways to apply for an NPI number.
- Paper application: You can obtain a copy of the NPI application/update form (CMS – 10114), complete it manually, and mail the signed application form to the NPI Enumerator located in Fargo, ND. For downloading the application form, you can visit the CMS website. Upon receiving your application form, the staff of the NPI enumerator will manually enter your application data into the NPPES system. You will receive your NPI number in 20 business days.
Healthcare providers and organizations can approach the following addresses if they face any problems or have questions regarding the NPI application process.
Phone: 1-800-465-3203 or TTY 1-800-692-2326
Mail: NPI Enumerator
7125 Ambassador Road Suite 100
Windsor Mill, MD 21244-2751
- Electronic application: Applying for an NPI number using the electronic application system is the most efficient and the fastest way. An electronic application system means using a web-based application process. To apply online, you have to visit the website of NPPES. You should read the instructions in detail, carefully fill out the questionnaire, and submit your application form. For the completion of the online application, you will need the following things;
- Legacy (current) provider identification numbers
- UPIN number
- Taxonomy codes
- License numbers
- Mailing address and practice address(es)
- Phone number and the name of the contact person for the enumerator in case further information is needed.
If someone other than you is filling your application form, you must provide them with the name of the country and state where you were born, your social security number, and your date of birth.
Once the NPPES confirms your application data, you will receive your NPI number from Customerservice@NPIEnumerator.com. You must regularly check your emails because the email might go directly to your spam folder if you have spam filters active. There is no fixed time when you will receive your NPI after submitting the application, but it usually arrives within ten business days of applying on the electronic forum.
- Electronic file interchange: Electronic file interchange is the third way of applying for an NPI number. It is also called bulk enumeration. In electronic file interchange, a healthcare provider or a group of healthcare providers can use a specific organization (the EFIO) to apply for an NPI on their behalf. In this process, instead of individuals or groups, EFIO submits a web or paper application and acquires an NPI for them.
The services of EFIO are highly distinguished in the manner that their one file may carry hundreds or even thousands of providers’ applications. EFIO submits these applications electronically. Offering all these applications together and on an electronic forum decreases the financial and administrative burden of the United States Department of Health and Human Services (HHS) and the provider community. The additional benefit of using EFIO is that it can also be used to change the information related to any existing NPI numbers.
Do I apply for individual NPI or as an organization?
If you want to start your career as a healthcare provider in the United States, you simply cannot do that without getting an NPI number. Now the question is, would you need an individual NPI number or as a group or organization? The answer is simple.
If you are working under an eligible healthcare organization, your organization will apply for an organization NPI (Type-2). However, you may still apply for an individual (rendering) NPI, which is type-1 of NPI. Suppose you are the only healthcare provider in your organization. In that case, it will not be considered as a sole proprietorship, and you are still bound to apply for an organizational, type-2, NPI number.
If you are working as an individual healthcare provider, you must apply for the type-1 NPI number under sole proprietorship. You are also required to submit your social security number during the process.
Receiving your NPI
Several factors affect the process of getting your National Identity Provider number. The duration of the process depends on whether you submitted the application electronically or through the mail. It also depends on whether the complete information is provided in the application and passes the editing process. Along with these factors, the volume of applications at a given period of time also affects the speed of the process of receiving an NPI.
If you submit a properly complete application electronically, you may receive your NPI number in 10 business days. On the other hand, paper applications take more time, and you will get your NPI in 20 business days if appropriately submitted.
How do I find my NPI number?
An NPI lookup for any individual healthcare providers or provider organizations can be done in several ways. The official website for NPI lookup is NPPES NPI Registry (https://npiregistry.cms.hhs.gov/). NPPES does not charge anything for looking up anyone’s NPI number.
The lookup process is simple. You can start the lookup by the name or the NPI number of the healthcare provider or provider organization. The search results are thorough and show everything about the provider, including his first and last name, type of NPI number, contact number, practice address, and taxonomy. The search results appear in a separate search result window. It can also be downloaded or streamlined using an Application Programming Interface (API).
Understanding NPI lookup results
NPI tracking can help in identifying and impeding healthcare frauds. You will have the following fields in the NPI lookup search result.
NPI: a uniques 10-digit number used for a healthcare provider’s identification
NPI type: to explain whether it is type-1 (individual provider) or type-2 (working with a provider organization)
Enumeration Date: the date when the NPI number was assigned to the provider
Status of NPI: whether the NPI is active or deactivated
Address: shows all the addresses linked with the NPI, primary practice address, and secondary addresses.
Taxonomy: shows the classification, type, and specialization of the healthcare provider. A provider may have more than one taxonomy code, but one code must be assigned as the primary taxonomy. This search will also show the license number and state code linked to taxonomy.
Other identifiers: matches the NPI with the insurers to help them recognize the healthcare provider.
Endpoint information: shows where you can contact the provider and access his service, usually mentions the URL or addresses.
What is the application cost of an NPI number?
The National Plan and Provider Enumeration System do not charge you anything for applying for an NPI number. The process is simple, absolutely free of cost, and can be done electronically by visiting the official website of the National Plan and Provider Enumeration System.
HIPAA rules for NPI
HIPAA has made basic rules for all the covered healthcare providers, clearinghouses, and healthcare plans listed below.
- According to CMS, it is mandatory for all covered healthcare providers, clearinghouses, and healthcare plans to use NPIs to perform all the HIPPA financial and administrative transactions.
- According to the Federal Regulation, HIPAA, it is obligatory for the covered healthcare providers to share their NPIs with other healthcare providers, organizations, health plans, and clearinghouses.
Can NPI replace TIM (Tax Identification Number)?
A general question that comes to every health provider’s mind is if their NPI can replace their TIM (Tax Identification Number) or other identification numbers they already have. The answer is no. The National Providers Identifier does not replace any other numbers used for any other identifications. They do not replace the taxpayers’ identification numbers, social license numbers, social security numbers, or DAE numbers. All these numbers have their own standings and purposes of fulfillment.
However, an NPI number replaces all the other existing numbers that can be used for healthcare information, medical transactions, healthcare billing, and insurance claims. Before NPI, UPIN (Unique Physician Identification Number) w as established as an alternative identifier to the social security number. The registry of UPIN was no longer available after its discontinuation in 2007. Later, CMS replaced UPIN with NPI as a preferred identification number for more accurate and reliable services. Other provider identification numbers can be used internally by healthcare plans and organizations, but using the NPI for all the HIPAA transactions is mandatory.
Will my NPI number change?
An NPI number does not change under any circumstances. It is merely a 10-digit number that does not carry any electronic information about personal details like office locations, cities, etc. It does not have to change even if the provider relocates or changes other personal information.
For making medical billing convenient and hassle-free, NPI numbers are of significant importance. They are also very helpful in increasing the efficiency of revenue cycle management. It is a mandatory requirement by HIPPA for all the healthcare providers, provider organizations, and clearinghouses to have an NPI number for the regulation and accurate tracking of healthcare services and reimbursement. Therefore, any insurance claim which does not contain a registered and valid NPI number will not be accepted by any health plan.
If you don’t have your National Provider Identifier yet, visit http://nppes.cms.hhs.gov/ or call customer service at 800.465.3203 and get one NOW!
You can also track your NPI application process by emailing customerservice@NPIEnumerator.com.