On April 2, 2007, the Centers for Medicare & Medicaid Services (CMS) announced that it is permitting the implementation of contingency plans for covered entities (other than small health plans) who will not meet the May 23, 2007, deadline for compliance with the National Provider Identifier (NPI) regulations under the Health Insurance Portability and Accountability Act of 1996 (HIPAA). As we announced in a previous Health Care Law E-Bulletin, previously all covered entities were required to be in compliance with the NPI rules by May 23, 2007, except for small health plans which were required to comply by May 23, 2008.  When fully effective, the NPI system will require that any health plan must use a provider’s NPI on all standard transactions where that provider's identifier is required, and health plans may not require a provider that has been assigned an NPI to obtain an additional identifier.  CMS has decided to allow some additional breathing room for covered entities that have been making good faith efforts to comply but that will not be fully NPI-compliant by May 23, 2007.  For such entities, or for entities whose trading partners will not be NPI-compliant by May 23, 2007, CMS is permitting the use of contingency plans that may include the use of legacy provider numbers where necessary to maintain operations and cash flow. 

The HIPAA enforcement process is complaint-driven.  If CMS receives a complaint that a covered entity is not in compliance with the NPI requirements after May 23, 2007, CMS will evaluate the entity’s good faith efforts to comply with the NPI standards and will not impose penalties on a covered entity that has implemented a contingency plan.  CMS is leaving it to the discretion of individual covered entities to determine how a contingency plan is structured.  If you or one of your trading partners will not be NPI-compliant by the May 23, 2007 deadline, you should make sure that you and your relevant trading partners understand what legacy identifiers will be used for which claims, and you should establish a timetable for full compliance with the NPI requirements.  Contingency plans may not extend past May 23, 2008.

You may apply for an NPI number online at CMS's site.  NPIs should be issued within a few days of submission of the application.  In addition to applying for an NPI, health care providers should contact their software vendors to ensure that their system is equipped to generate bills with NPIs or, if necessary, to receive the appropriate software upgrades.  Feel free to call any member of our Health Care Practice Group or any other Taft attorney with whom you have worked if you have questions about implementing an NPI contingency plan.  Further, feel free to call us if you have questions about how to obtain an NPI or if you have questions about how the NPI rules affect you, your practice or your health care facility.