By Maureen McKinney

April 8, 2008 | As the final deadline for the National Provider Identifier (NPI) program looms on the horizon, many providers are still struggling with arduous tasks like updating physician practice management systems and contacting clearinghouses in preparation for the switch. Many have already experienced cumbersome reimbursement issues related to NPIs, according to Martin Jensen, chief operating officer and chief analyst for the Tulsa-based Healthcare IT Transition Group.

By May 24, all Medicare fee-for-service claims must contain an NPI for provider identification — a requirement that could make receiving payment potentially difficult, says Jensen, especially given that some claims containing NPIs have already been held up for months.

One private practice physician Jensen recently spoke with has received more than 200 rejected Medicare claims, while another practice had nearly all of their claims rejected since October, he says.

“It’s hard to say with precision how extensive the problem is because Medicare is not being very open about it, but many of the providers we’ve spoken with have tried everything to get paid,” says Jensen, who is currently compiling NPI data from a national survey of providers. “Unfortunately, when Medicare takes an NPI and connects it with one of its legacy numbers through a crosswalk, sometimes it works and sometimes it doesn’t. There are definitely still kinks.”

One snag that has already become readily apparent is how best to manage multiple NPIs when a provider is incorporated or is providing services in multiple locations, explains Sandy Newman, director of health policy for the California Academy of Family Physicians (CAFP). The process has not been “entirely smooth” for CAFP members, and Newman urges providers to prepare well in advance and plan for glitches on the road to full implementation.

The Health Insurance Portability and Accountability Act (HIPAA) mandated the adoption of unique health identifiers and in January 2004, the final rule appeared requiring all HIPAA-covered providers to use NPIs in lieu of Medicare legacy numbers, social security numbers, or tax identification by May 2007.

However, in response to a flood of requests from the health care industry, the Centers for Medicare and Medicaid Services extended the deadline one year, provided an entity could show they had a contingency plan to achieve compliance with the program. As of March 1, providers are required to enter an NPI in the appropriate fields when filing Medicare claims, but they can do so in conjunction with a legacy number. But on May 24, use of legacy numbers and other identifiers will no longer be allowed and health care providers who submit claims without an NPI will not receive payment.

“The whole industry was completely unprepared last year and they knew it,” Jensen says. “Unfortunately, I don’t think providers are significantly more prepared this year and I don’t think they realize it.

To ensure the smoothest transition possible, Cindy Hughes, coding and compliance specialist for the American Academy of Family Physicians, is advising members to test a few claims using only the NPI to see whether they are accurately reimbursed. If there are problems – such as the practice management system inadvertently changed a digit, or the CMS crosswalk did not match the NPI to the correct claims history – the provider can begin addressing the issue right away, Hughes says.

“Testing is the most important strategy to make sure everything is working properly,” she says.

Jensen agrees advance testing is important, but says it is best to send more than a few claims through without a legacy number. Testing with a larger volume ensures viability of the NPI, and also demonstrates the identifier is mapping properly for a wide range of claims, Jensen says.