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Statement of the

American Health Care Association

to the

U.S. Department of Health and Human Services
National Committee on Vital and Health Statistics
Subcommittee on Standards and Security


HIPAA National Provider Identifier Implementation

Presented by:    Paul “Dave” Worthen
Chief Privacy Officer

March 31, 2006

Chairman Jeffrey Blair
Chairman Harry Reynolds
National Committee on Vital and Health Statistics
Hubert H. Humphrey Building, Room 505A
200 Independence Avenue, S.W.
Washington, DC 20201

Dear NCVHS Subcommittee Chairmen:

Thank you for the opportunity to offer written testimony for your review and consideration, which I submit on behalf of the American Health Care Association (AHCA) and the National Center For Assisted Living (NCAL).  AHCA/NCAL are the nation’s leading long term care organizations, representing nearly 11,000 non-profit and proprietary long term care facilities and committed to continuous quality improvement. 

We appreciate your leadership in holding a hearing to address concerns around implementation of National Provider Identifiers (NPIs) as required by the Health Insurance Portability and Accountability Act (HIPAA). These hearings will provide a vehicle for issues to be identified and corrected early on, so future operational problems can be avoided. Having a smooth transition to the use of NPIs is important to our membership, who each day provide professional and compassionate care for more than 1.5 million frail, elderly, and disabled Americans.

Executive Summary

We are concerned about the ability of providers to implement the NPI regulation on the currently defined schedule.  We see three (3) primary problem areas (discussed below).  The sum impact of these problem areas leads us to advocate for a delay in the currently published NPI implementation dates.  We would suggest an indefinite delay, i.e., a delay until the CMS NPPES system has the full functionality that has been promised.  Alternately, a one-year delay would give the industry (and CMS) some breathing room.

Detailed Observations

Problem #1  –  Data Dissemination:

The NPI Rule (see § 162.408 (f)) is explicit:

The National Provider System (NPS) shall … Disseminate NPS information upon approved requests.”

In fact, this functionality does not yet exist nor is there a reliable estimate of when it might be available.  This functionality is critical to the provider community.  In most instances when submitting a claim, institutional providers must identify the “human providers” (e.g., doctors) who rendered services relative to the claim.  Providers cannot do that without knowing the NPIs of the rendering individual providers.

The NPI Rule preamble (69 FR 3456) recognizes this requirement:

  • We agree with the majority of commenters who stated that … health care industry entities require NPS data … in order to effectively conduct HIPAA transactions.”
  • “Dissemination of data from the NPS is a complex process. It must be responsive to requests from covered entities for NPS information that they need in order to comply with HIPAA.”
  • “We expect to make routinely available, via the Internet and on paper, HHS-formatted data sets that will contain general identifying information, including the NPI …”

If the National Plan and Provider Enumeration System (NPPES) is allowed to default on what was promised, the healthcare industry will be forced to “scramble” (e.g., phones calls, faxes, emails, letters, etc.) to be able to submit claims at all.  The attendant costs, inefficiencies and waste are counter-productive for the entire healthcare system.  A better approach is to allow the NPPES the time necessary for the data dissemination functionality to be deployed.  NPI implementation should be delayed until the NPPES has the functionality that was promised.

Problem #2 –  Electronic File Interchange (EFI), a.k.a. “Bulk Enumeration”:

“Bulk enumeration” has been a touted feature of the NPPES system.  As the CMS website explains:

“By submitting these applications both simultaneously and electronically, the administrative and financial burdens for both the provider community and the U.S. Department of Health and Human Services (HHS) are greatly reduced.  …  CMS anticipates that EFI will be available in the late spring of 2006.”

We note that this feature is not yet available and is no longer promised “in the late spring of 2006.” 

Absent the bulk enumeration feature providers will be driven to submit individual transactions, either via paper or web-based, for each application.  Everyone recognizes that this is a sub-optimal approach – as evidenced by the snippet (above) from the CMS website.  A better approach is to allow the NPPES the time necessary for the bulk enumeration functionality to be deployed, followed by a reasonable period for health plans and providers to then use the system.  NPI implementation should be delayed until the NPPES has this promised functionality.

Problem #3 –  Subparts and Legacy Provider Numbers:

There is an industry-wide lack of understanding of how to determine “subparts” of providers for NPI purposes.  There has been one guidance paper from Medicare explaining how subparts are viewed from a Medicare perspective.  No other guidance has been issued from any source.

There is uncertainty as to how an organization’s many NPI numbers (many because the organization has many “subparts”) are going to replace the functionality inherent in their legacy provider numbers.  Currently, provider numbers are used to denote certifications, authorizations for special services, negotiated contracts, etc.  It is unclear has to whether and how NPIs for institutional providers can effectively replace current provider numbers.  It is also unclear as to how Medicare, Medicaid, and various other health plans will support accurate and timely payment, post facto reporting, and retrospective data analysis with the mix of legacy provider numbers and new NPIs (which will not have a one-to-one relationship, and may not have a reliable one-to-many relationship).

Our experience is that organization providers are hesitant to apply for NPIs due to a lack of understanding on how to correctly break their organizations into the correct “subparts”.  What is clear is that “out in the real world” there are some very complex scenarios and that guidance is needed on how to apply the NPI “subparts” concept to these complex situations.

We urge the Department to issue guidance and instruction on this topic at the earliest possible time, and to delay NPI implementation if workable solutions are not found to these problems.

Closing Remarks

We appreciate the Subcommittee’s attention to the complex details inherent in the NPI implementation effort.  The Subcommittee’s support of an implementation date extension is requested, as is a recommendation to the Secretary supportive of such an extension.  We believe that the industry’s experience with the “Transactions and Codeset” Rule, which ultimately required a implementation extension, should be instructive as to the time required to coordinate the myriad of details associated with a major administrative shift such as that required by the NPI Rule.

Thank you for the opportunity to offer these comments.  AHCA/NCAL are available to the Subcommittee as you consider your recommendations and we look forward to contributing to a smooth transition to the use of NPIs.


Paul “Dave” Worthen
Chief Privacy Officer

The American Health Care Association and the National Center For Assisted Living are the nation’s leading long term care organizations.  AHCA/NCAL represent nearly 11,000 non-profit and proprietary facilities dedicated to continuous improvement in the delivery of professional and compassionate care provided daily by millions of caring employees to more than 1.5 million of our nation’s frail, elderly and disabled citizens who live in nursing facilities, assisted living residences, subacute centers and homes for persons with mental retardation and developmental disabilities.