No NPI by May 23? You Need a Contingency Plan


Physicians and other health care providers who fail to comply with the May 23 deadline to acquire and start using National Provider Identifiers will not be penalized if they can show they deployed a “contingency plan,” the Centers for Medicare and Medicaid Services announced.

“Covered entities that have been making a good faith effort to comply with the NPI provisions may, for up to 12 months, implement contingency plans that could include accepting legacy provider numbers on HIPAA transactions in order to maintain operations and cash flows,” said CMS Acting Administrator Leslie Norwalk in a statement.

The agency decided to create this grace period “after it became apparent that many covered entities would not be able to fully comply with the NPI standard” by the original deadline, Ms. Norwalk said. The new compliance guideline can be downloaded from the agency's Web site (

According to Dr. Joseph S. Eastern, a Belleville, N.J., dermatologist who lectures widely on practice management issues, one poorly understood aspect of the NPI transition is the “taxonomies,” or supplemental codes that categorize the scope of your office's clinical services. For more on taxonomy codes, visit

To ensure a smooth transition for your practice, CMS lists seven steps:

1. Apply for an NPI at

2. Update your practice software, including billing applications, to incorporate your NPI.

3. Share your NPI with other providers, health plans, clearinghouses, and anyone else who may need it for billing purposes.

4. Communicate with all your health plans and clearinghouses; make sure they are all prepared for the NPI transition.

5. Test your systems to make sure they can process claims and any other HIPAA-related transactions with the NPI.

6. Educate your staff thoroughly on the NPI transition.

7. Implement use of your NPI in all your business practices.

Be sure to ask your software vendors to upgrade your system so that it incorporates your NPI, Dr. Eastern said.

Next Article: