Feds say plans can soften deadline for doctors' universal ID numbers

Washington -- The federal government has given the health care industry up to a year-long reprieve in adopting a new standard identification system for use on electronic claims. But that doesn't necessarily let doctors off the hook when it comes to obtaining and using the new ID numbers.

Under a mandate from Congress, the Centers for Medicare & Medicaid Services established May 23 as the deadline for physicians and other medical professionals to apply for and start using a unique National Provider Identifier on all electronic claims. The 10-digit NPI, designed to replace all other identifiers, is required for anyone who files claims electronically with Medicare or any other payer. This applies even if the physician uses an outside firm that files electronically on his or her behalf.

CMS recently came to the conclusion that too few health plans, doctors and others would be ready to use the NPI in place of all existing IDs, known as "legacy" identifiers, by the May deadline. Small health plans already have until May 2008 to comply, but the agency decided that many other large payers and health professionals also would need more time to get up to speed. Numerous industry organizations, including the American Medical Association, lobbied the government to soften the deadline.

So for the 12 months after the May 23 deadline, CMS will allow payers to process claims using either NPIs or older ID numbers without penalty, as long as the insurers have adopted appropriate contingency plans for moving to an NPI-only system. Physicians who are not ready to use their new numbers on all claims would benefit from this contingency period only if the payers they deal with decide to take advantage of the extra time.

At press time, federal officials were preparing such a plan for Medicare itself but had not yet decided how long the program would accept the old identifiers.

"The enforcement guidance released today clarifies that covered entities that have been making a good-faith effort to comply with the NPI provisions may, for up to 12 months, implement contingency plans that could include accepting legacy provider numbers on [electronic] transactions in order to maintain operations and cash flows." CMS Acting Administrator Leslie V. Norwalk said April 2.

The move means that claims using older identifiers won't automatically be rejected and not paid -- a fear that was expressed by several physician organizations in the two-year lead-up to the deadline. CMS will investigate complaints about entities that are not compliant but will not take action if contingency plans are acceptable.

Physicians need the extra time allowed under the CMS guidance to become compliant, said AMA Board of Trustees Chair Cecil B. Wilson, MD. "The AMA has aggressively pushed for this contingency plan, and we encourage health insurers, including Medicare, to take advantage of the entire 12-month timeframe."

Case-by-case basis

Whether and for how long a public health program or private insurance company will accept older identifiers is up to the payer. While some may accept older numbers from physicians during the entire contingency period, others, at any time after the deadline, could start requiring doctors to use only NPIs or risk not getting paid.

Some industry experts predicted that Medicare would not take the full year to make the transition to an NPI-only system. This means physicians would need to be able to use their new numbers on claims within months or risk seeing their Medicare reimbursements come to a halt.

At least one payer already has made the move to the new ID system and expects physicians to have done the same. Delaware's Medicaid program launched its NPI system months ahead of the upcoming deadline, said Karen Trudel, deputy director of the CMS Office of E-Health Standards and Services.

The trade group America's Health Insurance Plans expects many private payers will let doctors use NPIs and legacy identifiers on claims after May 23, said spokeswoman Susan Pisano. Some may wait to see what Medicare does before making a final decision.

Doctors will need to check with Medicare and Medicaid carriers, as well as each private insurer they bill, to see what they must do to make sure they continue getting paid.

Insurers have been encountering trouble in establishing "crosswalks," or transfers of physician information such as billing addresses and phone numbers, from the old identifiers to the new NPI system. Because of this, some may require doctors at some point to submit both the new numbers and the old ones on the same claim form in an effort to make the shift, said Robert Tennant, senior policy adviser for the Medical Group Management Assn.

A major reason why insurers have not been able to accomplish the crosswalks so far is that CMS has not yet issued a long-overdue policy defining who will have access to the information attached to the NPI and how it will be used, said MGMA President and CEO William F. Jessee, MD. This policy, which was expected last summer, also would allow access to information databases that will expedite the transition to the new system.

"Giving physician practices and health plans additional time to implement the NPI was a critically important decision," he said. "However, the necessity for this extension was due in part to CMS' failure to publish their data-dissemination policy in a timely manner and facilitate the communication of NPIs."

Get it, share it, use it

Dr. Jessee and the AMA's Dr. Wilson said their organizations were continuing to urge members who have not done so to get NPIs, share them with business partners and prepare to use them on electronic claims.

The Bush administration is still urging all physicians and other health professionals to apply for NPIs before the May deadline, CMS' Trudel said. Out of the roughly 2.3 million physicians, hospitals and other health care entities that need to obtain numbers, slightly less than 2 million had done so by the beginning of April.

But simply getting the NPI is only the first step. CMS determined that many of the new ID recipients have never used the number on a claim. Some doctors have been under the mistaken impression that the NPI is a confidential number and have refused to share it. Others are waiting for the agency to release its data dissemination policy to see what security measures are in place to protect identifiable physician information.

In addition, many physicians have the IDs but are unable to use them on claims because their practice management software has not yet been upgraded, MGMA's Tennant said.

Even when physicians get up to speed in their own practices, they also need to obtain the NPI of any doctor who refers patients to them. Over the next 12 months, CMS will try to educate physicians better on when and with whom it is appropriate to share the identifiers, Trudel said.

But after the year is up, all payers will be expected to reject claims without NPIs.

"We didn't want to leave it open-ended, because that would lead people to think that they have all the time in the world," she said.