The Health Insurance Portability and Accountability Act of 1996 (HIPAA) mandated the adoption of a standard unique identifier for healthcare providers to facilitate the simplification of the administration and transmission of healthcare data between providers, healthcare facilities, insurers and governmental oversight agencies. In particular, the National Provider Identifier (NPI) must be used in connection with all of the electronic transactions identified in HIPAA.
Key to this mandate was the development and implementation of the National Plan and Provider Enumeration System (NPPES) that collects identifying information on health care providers and assigns each one a NPI. The NPI is a unique 10-digit identification number and is mandated for use by:
In addition, these healthcare facilities are required to obtain an NPI:
medical equipment companies
The National Provider Identifier number will follow an individual throughout his healthcare career. Whether in private practice or in a group setting, their number will identify them for several purposes. In the latter case, the number is used to facilitate many activities including payor enrollment, billing and collection.
The primary benefit of the NPI is in the transfer of information from one entity to another. By uniquely identifying every provider, parties on each side of the transmission can communicate simply and efficiently. The NPI also includes a check digit in the final position to avoid keying errors. In addition, healthcare payors use the NPI to quickly double-check treatment regimens, provider privileges and insurance eligibility.
As an added bonus, the healthcare industry, as a whole, uses the information compiled in the NPI data set to examine and improve patient care as a whole. For example, the NPI data has been used to investigate referral patterns and improve their overall efficiency. In short, the use of a unique NPI for all healthcare providers and facilities has improved individual patient care, relieved providers of numerous administrative hassles and facilitated the making of payments in a timelier manner.
The registration process is quick and easy and only requires about a dozen pieces of information for either a provider or a facility. The NPI application and relevant instructions can be found here on the NPPES website. Approval takes from 3-20 days and once the NPI is assigned, it is included on a searchable database.
Securing an NPI does not replace the required process of payor enrollment, however it is a crucial first step for any new provider or provider starting a new solo practice or multi-provider group.