National Provider Identifier: Is the NPI crisis subsiding?

June 27, 2008

Rejection rates of insurance claims due to NPI problems are gradually returning to normal levels. But in case you?re still having problems, Medicare has thrown you a lifeline.

Rejection rates of insurance claims due to NPI problems are gradually returningto normal levels, says Emdeon Business Services, a third-party billing company.But in case you’re still having problems, Medicare has thrown you a lifeline.

The federal law known as HIPAA created the NPI to replace a plethora of identifiers that doctors and other providers included on claims to third-party payers, including Medicare. On March 1, providers were required to use the NPI for all electronic claims, although they were free to add their legacy identifiers. But beginning May 23, providers were supposed to submit only the NPI. Legacyidentifiers were verboten.

When May 23 rolled around, it seemed as if all Hades had broken loose. Emdeon reported that about one fourth of the Medicare and Medicaid claims it handled were getting bounced, compared to rejection rates of six percent and four percent respectively for these programs before May 23. Likewise, rejected Blue Cross claims rose from three percent to six percent. The failure rate’s been attributed in part to the Byzantine rules governing the NPI and conflicting advicefrom payers.

However, roughly one month after the NPI-only mandate took effect, rejection rates are settling down, says Miriam Paramore, Emdeon senior vice president of corporate strategy. While rejection rates for some payers are still above the status quo, they are not dramatically so. “Our experience is that it’s trending nicely to the pre-NPI level,” says Paramore, who declined to shareexact numbers.

While Medicare has characterized the conversion to the NPI as an overall success, it’s acknowledged that some providers may be experiencing cash flow problems due to rejected claims. Accordingly, it’s announced that it will give hard-pressed providers advance or accelerated payments “where facts and circumstances fall within the scope of the CMS regulations.” Medicare directs such providersto apply for special payments through their Medicare carrier.