No NPI Could Mean Claims Rejection in July, CMS Cautions

BALTIMORE–At a recent conference call on the National Provider
Identifer, CMS gave some insight into why the agency has softened
its mandate for use of the new number.

“By some estimates, almost half of the industry’s health plans
are not yet ready to use the NPI on the adjudication of claims,” an
agency official said. “More than a third of clearinghouses will not
use their NPIs to process transactions by the deadline. And while
we don’t have authority over the software vendors, we understand
that about half of the vendors’ software still cannot generate
claims using NPIs. Those are not very positive statistics this
close to a deadline.”

The agency set May 23 this year as the compliance deadline for
using the NPI on claims and emphasized that date is still firm for
all except small health providers, who have until May 23, 2008, to
comply. (See HomeCare Monday, April 9.)

However, under a contingency plan released April 20, CMS said
that for “some period after May 23, 2007,” Medicare will:

–Allow continued use of legacy numbers on transactions;
–Accept transactions with only NPIs; and
–Accept transactions with both legacy numbers and NPIs.

But the agency cautioned that as soon as it considers the number
of claims submitted with an NPI for primary providers (billing,
pay-to and rendering providers) is sufficient, Medicare could begin
rejecting claims without an NPI, perhaps as early as July 1,
2007.

This month, according to CMS, Medicare will evaluate the number
of claims it gets containing an NPI. If the analysis shows “a
sufficient number” of claims that have them, Medicare will begin to
reject claims without NPIs on July 1. If the agency judges there
are not enough claims containing NPIs, it will assess compliance
again in June and could begin rejecting non-compliant claims in
August.

Between now and May 23, 2008, CMS has previously said it will
not impose penalties for non-compliance “as long as covered
entities, including health plans and covered health providers,
continue to act in good faith to come into compliance, meaning they
are working towards being able to accept and send NPIs.”

While CMS believes some 2 million health care providers have
received their NPIs, “we think that’s only about 85 percent of the
universe,” the official said.

CMS has scheduled another conference call on the NPI contingency
plan on Thursday, May 10, at 2:00 p.m. EDT. Visit http://www.cms.hhs.gov/NationalProvIdentStand/Downloads/NPIRoundTable.pdf
for details and registration information.