HDG #017: NPI—wayyyy more than just a number
Read time: 7 minutes
Greetings, Gurus! Today we're going to look at the National Provider Identifier (NPI), the unique identification number assigned to healthcare providers by the Centers for Medicare & Medicaid Services (CMS), and—I guarantee—learn something new.
For my seasoned gurus: think you know all there is to know about NPIs? Think again!
We will also dive into the NPI database that every. single. person. in. healthcare. should have bookmarked: the NPPES NPI Registry AHEM and it should be right there next to the Medicare Fee Schedule/Physician Fee Schedule Look-up Tool, which I listed as 1 of 5 MUST-bookmark health datasets back in April) AHEM
What is the NPI?
The National Provider Identifier (NPI) is a unique identification number assigned to healthcare providers in the United States. NPIs are used for various purposes, including billing, identification, and tracking healthcare providers in electronic transactions. Basically, it is like the “social security number” of providers—their livelihood, professional history, and even authorization to “work” (in some ways) are all tied up in their NPI.
Before 2004, healthcare providers juggled multiple identifiers when working with different health insurers. It was messy, inefficient, and problematic. Recognizing these issues, the Health Insurance Portability and Accountability Act of 1996 (HIPAA) mandated a unique identifier for all healthcare providers. By 2007, the National Provider Identifier (NPI) was in full effect.
The NPI is more than just an "administrative simplification," as CMS calls it (irony, anyone?). It’s a 10-digit numeric identifier (10-digit number) affiliated with a specific provider. The number itself does not carry information about the provider's state or specialty. And it is a regulatory requirement: all covered healthcare providers, along with health plans and healthcare clearinghouses, must use NPIs in their administrative and financial transactions (claims processing/adjudication).
Did you know…
There are two types of NPIs: Type 1 and Type 2
“Type 1” (Individual NPI): An Individual NPI is assigned to healthcare providers who are individuals, such as physicians, dentists, nurse practitioners, psychologists, and other solo practitioners. It is tied to an individual provider regardless of the practice or organization they work for. Individual NPIs remain the same even if the provider changes their practice or moves to a different location. Individual NPIs are often used for identification and billing purposes when a healthcare provider is not associated with a group or organization. An individual is eligible for only one NPI.
“Type 2” (Group NPI): A Group NPI is assigned to healthcare organizations or groups, such as hospitals, nursing homes, medical clinics, group practices, healthcare facilities, and the corporation formed when an individual incorporates him/herself. It is used to identify the organization as a whole rather than individual providers within the group. Group NPIs are often associated with a specific practice location or a billing entity. Group NPIs are useful when multiple healthcare providers work together under a common organization or practice, allowing for streamlined billing processes and coordination of care.
The choice between using an Individual NPI or a Group NPI depends on the structure and needs of the healthcare provider or organization. Some healthcare providers may have both an Individual NPI and a Group NPI, using the Individual NPI for their personal identification and the Group NPI for billing and administrative purposes associated with their practice.
It's important to note that while Individual NPIs and Group NPIs serve different purposes, they are both essential for accurate and efficient healthcare billing and reimbursement processes. The NPI system ensures that healthcare providers can be uniquely identified and recognized across various healthcare systems and transactions.
And on a professional 1500 claim form, there are actually four different spots for four different NPIs:
17B: Referring Provider NPI
24J (1-6): Rendering Provider NPI(s)
32: Service Facility Location NPI—examples of Service Facility Location include hospitals, nursing homes, laboratories, or homeless shelters. Service Facility Location identifier is the facility’s Type 2 Organization NPI if they are a health care provider as defined under HIPAA. If the service facility is not assigned an NPI, this data element will not be populated.
33: Billing Provider NPI
You may commonly see a Group NPI listed as the Billing Provider NPI, and an Individual NPI listed as the Rendering Provider NPI on a claim. And in some cases, they will be the same.
In my experience, the fields I have dealt with the most for analysis TEND to be the Billing Provider NPI (from Item 33) and the Rendering (aka Servicing) Provider NPI (from Item 24J).
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So, what’s “new” about NPIs?
Not much in like 100 years BUT… the NPI is much more than just a unique identifying number. And that is what may be new news to you.
The NPI: Not just for CMS—it’s for credentialing, contracting, and payments, oh my!
Did you know that the NPI impacts credentialing (how providers get registered with health plans and paid by them), health plan network contracts (which providers are in/out), what services providers can bill for (taxonomy), and so much more (demographics, locations, specialties, etc.)?
Credentialing, if you’re unfamiliar, is an activity conducted by healthcare organizations (such as hospitals, clinics, and insurance companies) to ensure that the providers they employ or contract with are qualified and competent. Credentialing is the process of verifying and evaluating the qualifications, skills, and professional background of healthcare providers. It ensures that healthcare professionals, such as physicians, nurses, and allied health practitioners, meet the necessary standards and requirements to practice in their respective fields and involves a comprehensive review of an individual's education, training, licensure, certifications, work experience, and other credentials. It is done in an ongoing and continuous fashion (credentialing and re-credentialing), and every.single.plan.that.providers.are.contracted.with does their own credentialing for their providers.
And the NPI is a MAJOR part of this process, as that is the level at which providers are credentialed.
Providers’ entire ability to contract with, and get paid by, the numerous disparate health plans of the patient population is tied to their NPI. And they must be credentialed with all of them to receive any payment from them (with some rare cases).
Regarding credentialing, it's crucial to remember that issuance of an NPI does not ensure or validate that the provider is credentialed with an individual health plan, so just because a provider is listed in NPPES doesn’t necessarily mean they can provide services (or get paid for them by a certain health plan, more accurately).
Once a provider is credentialed with a health plan, their NPI is used to add them to specific networks, contracts, and thus benefits.
For example, you might see a certain provider is “in-network” for a specific product or plan offered by a health insurance company (for instance, Dr. Goradia is in-network (INN) for the [insert any mega health insurer name here] PPO 5000 Gold). But on the same site, you might see Dr. Goradia is “out-of-network” (OON) for the same insurance company’s other product, the HMO 2000 Bronze. This means Dr. Goradia is contracted for one, but not the other, with the same insurance company, and this is typically tracked at—you guessed it—the NPI level.
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NPI data: it’s no claims data, but it’s still a gem in the data detective's treasure chest
For analysts, the NPI isn’t just a series of numbers to identify a provider—it’s also an analytical tool. You can use it to find out a provider's status, affiliations, taxonomy codes, and licensure. It has a lot of valuable and insightful data just waiting to be unlocked.
While the NPI and its corresponding provider information is not as valuable for medical economic analyses as, say, CMS-1500 professional claims data (IMHO—come at me), the NPI is still an analytical boon, summarizing a provider's status, affiliations, taxonomy codes, licensure, mailing and practice addresses, and more. It is very valuable for network and reimbursement analysis, stratifying providers by Billing NPIs (typically an organization or group) and rendering (typically the individual provider performing the service). It’s also an effective way to group individual providers by their practice or like-characteristics (region, specialty, etc.)
Individuals or organizations apply for NPIs through the CMS National Plan and Provider Enumeration System (NPPES), or NPI Registry
(as usual, CMS had to overcomplicate and lengthen the name)
And the great news for users like us is that they provide access to this data in a very robust database that contains all of the NPI information about every single NPI-assigned provider.
To look up a provider’s NPI or to look up which provider an NPI belongs to, visit the NPPES/NPI Registry here:
https://npiregistry.cms.hhs.gov/search
The lookup tool allows you to search by name, address, state, by NPI, etc.:
Look at all those Goradias!
But they also supply this directory in a full download file, or through an Application Programming Interface (API) so that you can pull provider data like location, specialty, and more into your healthcare applications.
The lookup tool is great for quick research or to look up a certain provider (or a certain NPI), but I highly recommend downloading the Full Replacement Monthly NPI File (also referred to as the NPPES Downloadable File).
This .csv file lists all active NPIs, deactivated, all corresponding data about those providers.
More than once I have read this downloadable .csv into a database and then used it to pull key provider information by NPI. I have used it to pull addresses for geospatial mapping, to group providers by region and specialty, and do stratified network analysis. I’ve also used it to “de-dup” records as a source of truth (of sorts) when my internal data for an NPI (like name, address, etc.) were all slightly different variations.
In short, this is a very easy to join on—using NPI as a key—to pull tons of valuable info about that provider.
These are the fields that this database has for every single provider with an NPI:
Some of the fields may contain a code, such as the field Entity Type Codes, which has values of 1 or 2. This PDF document contains all the Code Values you need to crosswalk those values into meaningful information.
In the Entity Type Codes case, the document shows that 1 = Individual and 2 = Organization. In other words, this is how to identify if the NPI is a Type 1 or Type 2 NPI that we discussed earlier.
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Actionable Idea of the Week:
Familiarity is an underrated path to mastery. Start by looking up NPIs on the NPI Registry. Begin by searching for providers you're familiar with—perhaps a local clinic or hospital. See how they’re listed in the registry compared to what you “know them” as. See what new information you learn by looking up their data in NPPES. Does the taxonomy/specialty track? Address? Legal name?
As you sift through the information, think about how the NPI can be used beyond just billing and credentialing. How could this data inform your work or research? Could it highlight patterns, identify gaps, or present opportunities for improving health outcomes? Could you merge some of this data with your internal data for more insight? Could it help you look at things from a geospatial perspective?
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Remember, the more you know about what data exists out there, the more powerful your analysis will be!
See you next week!
-Sg
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