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What is the purpose of an NPI number?

We’ve heard a lot of talks lately about the NPI. What is it?

On the national level, the National Provider Identifier (NPI) can recognize health care providers. This implies that all organizations in the health care sector can accept NPI. The NPI would substitute commonly used identifiers for health care providers. For example, Medicare legacy numbers such as UPINs (unique physician [provided] identification numbers) and PINs. The NPI is a 10-position, intelligence-free numeric identifier (10-digit number).

According to the HIPAA act, covered providers must also share their NPI with other providers, health plans, clearinghouses, and any entity that may need it for billing purposes.

Why is NPI important?

It is intended to improve the efficiency of the health care system and help to reduce fraud and abuse. CMS is taking steps to improve the electronic transactions in health care with the NPI. The main purpose of an NPI number is that it is a mandated HIPAA standard and because it should simplify billing. Using the NPI, the Medicare and Medicaid systems, and other federal insurance programs and private health programs would enhance the quality and efficacy of the health care sector in general by simplifying the management of the health care system and enabling the efficient electric transmission of certain health information.

Doctors smiling and working together
Doctors smiling and working together at work

Who must obtain an NPI?

All individuals and organizations that meet the definition of health care provider as described at 45 CFR 160.103 are eligible to obtain a National Provider Identifier (NPI). You must have an NPI if you are a HIPAA-covered provider or if you are a health care provider or provider that bills federally sponsored programs for your services.

Will a provider’s NPI ever change?

NPI is like a diamond as it will last forever. Once you get an NPI it can never be changed. When a health care worker (a physician, for example) dies, his individual NPI will be deactivated. The individual NPI will also be deactivated if a provider goes out of business. The deactivated NPI will never be provided to other providers of health care.

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