CMS gears up new supplier numbers

Thursday, June 30, 2005

BALTIMORE -- CMS began accepting applications in May for the new 10-digit National Provider Identification (NPI) that will replace the healthcare provider numbers, including Medicare supplier numbers, currently used for standard transactions.
CMS created the NPI, a requirement of the Health Insurance Portability and Accountability Act of 1996, to help improve electronic transactions for health care.
According to CMS: "Each physical location of a supplier of DME, orthotics, prosthetics, or supplies will be considered a health care provider in its own right and must apply for and will be assigned an NPI."
"The NPI means that each provider will have one provider number unique to them that can be used for every payer across the board," said Sara Hanna, vice president of ECS Billing and Consulting in Tiffin, Ohio. "It should make things easier."
The transition from existing numbers to the NPI will occur over the next few years. All HIPAA-covered health plans must implement the NPI by May 23, 2007. Small health plans have until May 23, 2008. Hanna cautioned that companies should wait to start using their NPI until individual health plans indicate that they are ready to accept them.
Medicare will begin accepting NPI transactions accompanied by an existing Medicare number beginning January 3, 2006. On October 2, 2006, the agency will accept either identifier with the goal of phasing out existing provider numbers by May 23, 2007.
Hanna said the cost of the application paperwork and updates to billing software and materials should be minimal. Unforeseen program glitches on the part of the health plans could be a concern, however.
"There could be some expense if a payer source says they are ready to accept the NPI, and then there are bunch of glitches in the system," said Hanna. "That's were I think the cost would come into play as claims get denied because of an NPI glitch or an edit problem."
A similar problem arose when Medicare switched to the ANSI system, she said.
"I could envision this would be a problem again. Companies could lose money if their claims are held up," she said. "That's where I see cost rather than from the provider's implementation standpoint."