March 2008

NPI Compliance and Provider Updates from CMS

Industry-Wide Enforcement of the NPI Compliance Date
Effective May 24, 2008, all HIPAA-covered entities are expected to be using the National Provider Identifier (NPI) in a compliant manner and all contingency plans should be lifted.

The compliance date for the NPI for all HIPAA-covered entities except for small health plans was May 23, 2007. Small health plans have until May 23, 2008 to comply.

On April 2, 2007, the Centers for Medicaid & Medicare Services (CMS) announced a temporary policy: CMS will not impose penalties on covered entities that deploy contingency plans to facilitate the compliance of their trading partners.

On May 24, 2008, this enforcement-leniency policy will end. CMS will continue to employ a complaint-driven approach to enforcement, and will require evidence of a contingency plan or compliance. If violations are identified, enforcement actions will take place.

This notice does not prohibit covered entities from lifting contingency plans prior to May 24, 2008.

NPPES and the NPI Enumerator: Misconceptions & Facts
To help understand the National Plan and Provider Enumeration System (NPPES) and the NPI Enumerator, compare common misconceptions and facts in the table below.

The specific duties and responsibilities of the NPI Enumerator can be found in the Medicare Learning Network Matters (MLN; #SE0751) newsletter on the CMS Web site. Check the CMS Web site for a future article clarifying the functions of NPPES and the functions of the NPI Enumerator.

Medicare’s Key Dates

March 1, 2008 – Claims with only legacy identifiers in the primary provider fields will be rejected.

• Medicare FFS 837 professional (837P) and CMS-1500 claims must include an NPI in the primary provider fields on the claim (i.e., the billing, pay-to, and rendering fields).
• Providers may continue to submit NPI/legacy pairs in these fields or submit only your NPI on the claim.
• Providers may not submit claims containing only a legacy identifier in the primary provider fields.
• Failure to submit an NPI in the primary provider fields will result in the claim being rejected or returned because it could not be processed.
• Until further notice, providers may continue to include legacy identifiers only for the secondary provider fields.

May 23, 2008 – Claims with a legacy identifier in any field will be rejected.

• In keeping with the Contingency Guidance issued on April 2, 2007, CMS will lift its NPI contingency plan, meaning that only the NPI will be accepted and sent on all HIPAA electronic transactions (837I, 837P, NCPDP, 276/277, 270/271 and 835), paper claims and SPR remittance advice.
  Note: This date is one day earlier than mandated by the National Enforcement Policy.
• This also includes all secondary provider fields on the 837P and 837I. The reporting of legacy identifiers will result in the rejection of the transaction.
• CMS will also stop sending legacy identifiers on Coordination of Benefit (COB) crossover claims at this time.

Provider NPI Testing of Medicare Claims

Only Four Months Until May 23 – Test NPI-Only Claims
While Medicare is receiving well over 90 percent of claims containing an NPI in primary provider fields, there is only a very small percentage of claims submitted with an NPI only. Until you submit a claim with an NPI only, you will not have a preview of what your experience will be on May 23, 2008. CMS urges all Medicare providers to test now so that problems can be resolved prior to May 23. For example, if there is a problem that requires a change in your Medicare enrollment information, you will need to act immediately.

Providers that already had claims processed correctly using both an NPI and a legacy provider number are encouraged to submit a small batch of Medicare claims using only the NPI in the primary provider fields. These submissions will function as a test to make sure future claims will process correctly using only the NPI. If claims continue to be processed correctly, begin increasing the number of Medicare claims submitted using only the NPI.

Reminder: For institutional claims, the primary provider fields are the Billing and Pay-to Provider fields.  For professional claims, the primary provider fields are the Billing, Pay-to Provider, and Rendering Provider fields. If the Pay-to Provider is the same as the Billing Provider, the Pay-to Provider does not need to be identified.

If providers test the new billing method, and their claims are processed successfully, they will be prepared for the May 23 changeover.

For additional information about testing the NPI on Medicare claims submissions, please review the November 2007 CMS Announcements.

DMEPOS Suppliers Rejected Claims
Medicare Durable Medical Equipment, prosthetics, orthotics and supplies (DMEPOS) suppliers may be experiencing claims rejections if they did not obtain their NPIs properly, if they are not properly enrolled in Medicare, or both. For example, if a DMEPOS supplier who is a sole proprietorship enrolled with the National Supplier Clearinghouse (NSC) as an organization and furnished an Employer Identification Number (EIN) instead of a Social Security Number (SSN) but obtained an entity type 1 NPI (individual NPI), the Medicare NPI crosswalk will be unable to link that DMEPOS supplier's Medicare legacy identifier (NSC number) to its NPI. This is because the NSC number and the NPI identify different entity types; one identifies an organization and the other an individual. When no link exists between a Medicare legacy identifier and an NPI used in a claim in the Medicare NPI crosswalk, the claim will reject. DMEPOS suppliers should contact the DME Medicare Administrative Contractor (MAC) if they do not understand the error message they received.

Noridian Administrative Services serves DMEPOS suppliers within the state of California. The phone number for Noridian Administrative Services DMEPOS claim information is 1-866-243-7272.

If the rejection was due to the inability of the Medicare NPI crosswalk to link the NPI to the NSC number, the DMEPOS supplier should check the NPPES record to ensure the appropriate entity type (1 = Individual, 2 = Organization) is reflected in that record. Individuals (including sole proprietorships) obtain an entity type 1 NPI (individual NPI). Organizations obtain an entity type 2 NPI (organization NPI). If the NPPES record shows the appropriate entity type, the DMEPOS supplier should contact the NSC to ensure the enrollment record is correct. If the NPPES record does not show the appropriate entity type, the DMEPOS supplier needs to take action to ensure the appropriate entity type is selected. If assistance is necessary, the NPI Enumerator (1-800-465-3203) can explain to the DMEPOS supplier how this is done. 

Once the NPPES record is correct, the DMEPOS supplier needs to ensure that it is properly enrolled in Medicare. The NSC, once contacted, will ask appropriate questions to determine if the DMEPOS supplier is, in fact, a sole proprietorship, and if so, properly reflected as such in the enrollment record. The NSC will assist the DMEPOS suppliers in correcting their enrollment records.

DMEPOS suppliers who are sole proprietorships should be aware of the following:

• A DMEPOS supplier who is a sole proprietorship obtains an entity type 1 NPI (individual NPI). 
• When enrolling in Medicare with the NSC on the CMS 855S, a DMEPOS supplier who is a sole proprietorship furnishes their SSN as the Taxpayer Identification Number (TIN). 
• The Legal Name of the sole proprietorship business is the sole proprietor’s name. 
• It is possible for the sole proprietorship to have a “doing business as (dba)” name. The dba name can be reported on the CMS 855S and on the NPI application (in the Other Name field).  A dba name, however, is not a Legal Name.
• It is possible that the sole proprietorship requested and received an Employer Identification Number (EIN) from the IRS if the sole proprietorship has employees. This EIN will protect the sole proprietor’s SSN from appearing on claims and W-2s. 
• Medicare will treat the EIN as the TIN for purposes of claims processing, but the SSN must still be reported on the CMS 855S. 
• When Medicare reports tax information to the IRS for that EIN, the IRS will link that EIN to the sole proprietor’s SSN.

Obtain and Report NPIs for Referred or Ordered Services or Items
Providers should be aware that it is the claim/bill submitter‘s responsibility to obtain the ordering, referring and attending, operating, other, service facility providers, or purchased service providers’ NPIs on claims. Medicare will not pay for referred or ordered services, or items, unless the name and NPI number of the ordering, referring and attending, operating, other, or service facility provider are on the claim.

For more details, review the MLN Matters (#MM5890) newsletter on the CMS Web site.

March 2008

Medicare Fee-for-Service Provider Claims Processing Update

Effective March 1, 2008, all Medicare claims submitted by Fee-for-Service (FFS) providers will be rejected if both the National Provider Identifier (NPI) and the Medicare legacy provider number data have not been corrected or updated in their National Plan and Provider Enumeration System (NPPES) records.

The NPPES data must be current so that Medicare can validate or “crosswalk” the claims submitted by FFS providers by comparing the NPI to the legacy provider number. Claims will reject if this data is not accurate. FFS providers such as Medicare physicians, Non-Physician Medical Practitioners (NMPs) and other related suppliers could experience rejected claims because of incorrect data.

If the claims are being rejected, logon to the National Plan and Provider Enumeration System (NPPES) Web site to validate your provider data.

The following forms from the Centers for Medicare & Medicaid Services (CMS) may be required for FFS providers to correct or update NPPES data elements:

• National Provider Identifier (NPI) Application/Update Form (CMS 11014) – This form is used if the NPPES data correction or update requires an original signature or the signature of an official authorized to sign for the provider or health organization.
• Medicare Enrollment Application (CMS 855A; 855B; 855I; 855R; 855S) – The correction or update may require an FFS provider to have one of these forms to be on file with a carrier, Durable Medical Equipment (DME) Medicare Administrative Contractor (MAC), Part A MAC or Part B MAC. FFS providers should refer to the CMS Web site for more information about the correct application to file.

FFS claims will also reject if the NPI is not listed in the primary provider fields such as “billing,” “pay-to ” and “rendering.” Claims with only a Medicare legacy number in the primary provider field will be rejected.

NPI Testing on Medicare Claims for FFS Providers
FFS providers that already had claims processed correctly using both the NPI and legacy provider numbers are encouraged to submit a small batch of Medicare claims using only the NPI. These submissions will function as a test to make sure future claims will process correctly using only the NPI. If claims continue to be processed correctly, begin increasing the number of Medicare claims submitted using only the NPI.

Need More Information?
More information can be found in the NPI area of the CMS Web site. Providers can apply for an NPI online on the NPPES Web site or call the NPI enumerator to request a paper application at 1-800-465-3203. Providers can review all past NPI announcements from CMS on the CMS Communications page.