National Standard
Health Care Provider Identifier
In this proposed rule, we propose a standard health care provider
identifier and requirements concerning its implementation. This
rule would establish requirements that health plans, health care
providers, and health care clearinghouses would have to meet to
comply with the statutory requirement to use a unique identifier
in electronic transactions. We propose to add a new part to title
45 of the Code of Federal Regulations for health plans, health care
providers, and health care clearinghouses in general. The new part
would be part 142 of title 45 and would be titled “Administrative
Requirements.” Subpart D would contain provisions specific
to the NPI.
A. Applicability
Section 262 of HIPAA applies to all health plans, all health care
clearinghouses, and any health care providers that transmit any
health information in electronic form in connection with transactions
referred to in section 1173(a)(1) of the Act. Our proposed rules
(at 45 CFR 142.102) would apply to the health plans and health care
clearinghouses as well, but we would clarify the statutory language
in our regulations for health care providers: we would have the
regulations apply to any health care provider only when electronically
transmitting any of the transactions to which section 1173(a)(1)
of the Act refers.
Electronic transmissions would include transmissions using all
media, even when the transmission is physically moved from one location
to another using magnetic tape, disk, or CD media. Transmissions
over the Internet (wide-open), Extranet (using Internet technology
to link a business with information only accessible to collaborating
parties), leased lines, dial-up lines, and private networks are
all included. Telephone voice response and “faxback” systems
would not be included. The “HTML” interaction between
a server and a browser by which the elements of a transaction are
solicited from a user would not be included, but once assembled
into a transaction by the server, transmission of the full transaction
to another corporate entity, such as a health plan, would be required
to comply.
Our regulations would apply to health care clearinghouses when
transmitting transactions to, and receiving transactions from, a
health care provider or health plan that transmits and receives
standard transactions (as defined under “transaction”)
and at all times when transmitting to or receiving electronic transactions
from another health care clearinghouse. The law would apply to each
health care provider when transmitting or receiving any electronic
transaction.
The law applies to health plans for all transactions.
Section 142.104 would contain the following provisions (from section
1175 of the Act):
If a person desires to conduct a transaction (as defined in §
142.103) with a health plan as a standard transaction, the following
apply:
- The health plan may not refuse to conduct the transaction as
a standard transaction.
- The health plan may not delay the transaction or otherwise adversely
affect, or attempt to adversely affect, the person or the transaction
on the ground that the transaction is a standard transaction.
- The information transmitted and received in connection with
the transaction must be in the form of standard data elements
of health information.
As a further requirement, we would require that a health plan that
conducts transactions through an agent assure that the agent meets
all the requirements of part 142 that apply to the health plan.
Section 142.105 would state that a person or other entity may meet
the requirements of § 142.104 by either--
- Transmitting and receiving standard data elements, or
- Submitting nonstandard data elements to a health care clearinghouse
for processing into standard data elements and transmission by
the health care clearinghouse and receiving standard data elements
through the clearinghouse.
Health care clearinghouses would be able to accept nonstandard
transactions for the sole purpose of translating them into standard
transactions for sending customers and would be able to accept standard
transactions and translate them into nonstandard formats for receiving
customers. We would state in § 142.105 that the transmission
of nonstandard transactions, under contract, between a health plan
or a health care provider and a health care clearinghouse would
not violate the law.
Transmissions within a corporate entity would not be required to
comply with the standards. A hospital that is wholly owned by a
managed care company would not have to use the standards to pass
encounter information back to the home office, but it would have
to use the standard claims transaction to submit a claim to another
health plan. Another example might be transactions within Federal
agencies and their contractors and between State agencies within
the same State. For example, Medicare enters into contracts with
insurance companies and common working file sites that process Medicare
claims using government furnished software. There is constant communication,
on a private network, between HCFA Central Office and the Medicare
carriers, intermediaries and common working file sites. This communication
may continue in nonstandard mode. However, these contractors must
comply with the standards when exchanging any of the transactions
covered by HIPAA with an entity outside these “corporate”
boundaries.
B. Definitions
Section 1171 of the Act defines several terms and our proposed
rules would, for the most part, simply restate the law. The terms
that we are defining in this proposed rule follow:
1. Code set.
We would define “code set” as section 1171(1) of the
Act does: “code set” means any set of codes used for encoding
data elements, such as tables of terms, medical concepts, medical
diagnostic codes, or medical procedure codes.
2. Health care clearinghouse.
We would define “health care clearinghouse” as section
1171(2) of the Act does, but we are adding a further, clarifying
sentence. The statute defines a “health care clearinghouse”
as a public or private entity that processes or facilitates the
processing of nonstandard data elements of health information into
standard data elements. We would further explain that such an entity
is one that currently receives health care transactions from health
care providers and other entities, translates the data from a given
format into one acceptable to the intended recipient and forwards
the processed transaction to appropriate health plans and other
clearinghouses, as necessary, for further action.
There are currently a number of private clearinghouses that perform
these functions for health care providers. For purposes of this
rule, we would consider billing services, repricing companies, community
health management information systems or community health information
systems, value-added networks, and switches performing these functions
to be health care clearinghouses.
3. Health care provider.
As defined by section 1171(3) of the Act, a “health care provider”
is a provider of services as defined in section 1861(u) of the Act,
a provider of medical or other health services as defined in section
1861(s) of the Act, and any other person who furnishes health care
services or supplies. Our regulations would define “health
care provider” as the statute does and clarify that the definition
of a health care provider is limited to those entities that furnish,
or bill and are paid for, health care services in the normal course
of business.
The statutory definition of a health care provider is broad. Section
1861(u) contains the Medicare definition of a provider, which encompasses
institutional providers such as hospitals, skilled nursing facilities,
home health agencies, and comprehensive outpatient rehabilitation
facilities. Section 1861(s) defines other Medicare facilities and
practitioners, including assorted clinics and centers, physicians,
clinical laboratories, various licensed/certified health care practitioners,
and suppliers of durable medical equipment. The last portion of
the definition encompasses any appropriately licensed or certified
health care practitioners or organizations, including pharmacies
and nursing homes and many types of therapists, technicians, and
aides. It also includes any other individual or organization that
furnishes health care services or supplies. We believe that an individual
or organization that bills and is paid for health care services
or supplies is also a health care provider for purposes of the statute.
Section 1173(b)(1) of the Act requires the Secretary to adopt standards
for unique identifiers for all health care providers. The definition
of a “health care provider” at section 1171(3) includes
all Medicare providers and “any other person furnishing health
care services and supplies.” These two provisions require that
provider identifiers may not be limited to only those health care
providers that bill electronically or those that bill in their own
right. Instead provider identifiers will eventually be available
to all those that provide health services. Penalties for failure
to use the correct identifiers, however, are limited to those that
fail to use the identifiers or other standards in the nine designated
electronic transactions. As we discuss under a later section in
this preamble,III. Implementation of the NPI, we do not expect
to be able to assign identifiers immediately to all health care
providers that do not participate in electronic transactions.
Our proposed definition of a health care provider would not include
health industry workers who support the provision of health care
but who do not provide health services, such as admissions and billing
personnel, housekeeping staff, and orderlies.
We describe two alternatives for defining general categories of
health care providers for enumeration purposes. In the first, we
would categorize health care providers as individuals, organizations,
or groups. In the second, we would categorize health care providers
as individuals or organizations, which would include groups. The
data to be collected for each category of health care provider are
described in the preamble in section IV. B. Data Elements.
We welcome your comments on whether group providers need to be distinguished
from organization providers.
Individuals are treated differently than organizations and groups
because the data available to search for duplicates (for example,
date and place of birth) are different. Organizations and groups
may need to be treated differently from each other because it is
possible that a group is not specifically licensed or certified
to provide health care, whereas an organization usually is. It may,
therefore, be important to be able to link the individual members
to the group. It would not be possible to distinguish one category
from another by looking at the NPI. The NPS would contain the kinds
of data necessary to adequately categorize each health care provider.
The categories are described as follows:
Individual--A human being who is licensed, certified or
otherwise authorized to perform medical services or provide medical
care, equipment and/or supplies in the normal course of business.
Examples of individuals are physicians, nurses, dentists, pharmacists,
and physical therapists.
Organization--An entity, other than an individual, that
is licensed, certified or otherwise authorized to provide medical
services, care, equipment or supplies in the normal course of business.
The licensure, certification, or other recognition is granted to
the organization entity. Individual owners, managers, or employees
of the organization may also be certified, licensed, or otherwise
recognized as individual health care providers in their own right.
Each separate physical location of an organization, each member
of an organization chain, and each subpart of an organization that
needs to be identified would receive its own NPI. NPIs of organization
providers would not be linked within the NPS to NPIs of other health
care providers. Examples of organizations are hospitals, laboratories,
ambulance companies, health maintenance organizations, and pharmacies.
In the first alternative for categorizing health care providers,
as described above, we would distinguish a group from an organization.
We would define a group as follows:
Group--An entity composed of one or more individuals (as
defined above), generally created to provide coverage of patients’
needs in terms of office hours, professional backup and support,
or range of services resulting in specific billing or payment arrangements.
It is possible that the group itself is not licensed or certified,
but the individual(s) who compose the group are licensed, certified
or otherwise authorized to provide health care services. The NPIs
of the group member(s) would be linked within the NPS to the NPI
of the group. An individual can be a member of multiple groups.
Examples of groups are (1) two physicians practicing as a group
where they bill and receive payment for their services as a group
and (2) an incorporated individual billing and receiving payment
as a corporation.
The ownership of a group or organization can change if it is sold,
consolidated, or merged, or if control changes due to stock acquisition.
In many cases, the nature of the provider itself (for example, its
location, staff or types of services provided) is not affected.
In general, the NPI of the provider should not change in these situations
unless the change of ownership affects the nature of the provider.
(Example: If a hospital is acquired and then converted to a rehabilitation
center, it would need to obtain a new NPI.) There may also be circumstances
where a new NPI should be issued. (Example: a physicians’ group
practice operating as a partnership dissolves that partnership and
another partnership of physicians acquires and operates the practice.)
We solicit comments on rules to be applied.
We discuss the enumeration of health care providers in more detail,
in III. Implementation of the NPI, later in this preamble.
4. Health information.
“Health information,” as defined in section 1171 of the
Act, means any information, whether oral or recorded in any form
or medium, that--
- Is created or received by a health care provider, health plan,
public health authority, employer, life insurer, school or university,
or health care clearinghouse; and
- Relates to the past, present, or future physical or mental
health or condition of an individual; the provision of health
care to an individual; or the past, present, or future payment
for the provision of health care to an individual.
We propose the same definition for our regulations.
5. Health plan.
We propose that a “health plan” be defined essentially
as section 1171 of the Act defines it. Section 1171 of the Act cross
refers to definitions in section 2791 of the Public Health Service
Act (as added by Public Law 104-191, 42 U.S.C. 300gg-91); we would
incorporate those definitions as currently stated into our proposed
definitions for the convenience of the public. We note that many
of these terms are defined in other statutes, such as the Employee
Retirement Income Security Act of 1974 (ERISA), Public Law 93-406,
29 U.S.C. 1002(7) and the Public Health Service Act. Our definitions
are based on the roles of plans in conducting administrative transactions,
and any differences should not be construed to affect other statutes.
For purposes of implementing the provisions of administrative simplification,
a “health plan” would be an individual or group health
plan that provides, or pays the cost of, medical care. This definition
includes, but is not limited to, the 13 types of plans listed in
the statute. On the other hand, plans such as property and casualty
insurance plans and workers compensation plans, which may pay health
care costs in the course of administering nonhealth care benefits,
are not considered to be health plans in the proposed definition
of health plan. Of course, these plans may voluntarily adopt these
standards for their own business needs. At some future time, the
Congress may choose to expressly include some or all of these plans
in the list of health plans that must comply with the standards.
Health plans often carry out their business functions through agents,
such as plan administrators (including third party administrators),
entities that are under “administrative services only”
(ASO) contracts, claims processors, and fiscal agents. These agents
may or may not be health plans in their own right; for example,
a health plan may act as another health plan’s agent as another
line of business. As stated earlier, a health plan that conducts
HIPAA transactions through an agent is required to assure that the
agent meets all HIPAA requirements that apply to the plan itself.
“Health plan” includes the following, singly or in combination:
a. “Group health plan” (as currently defined by section
2791(a) of the Public Health Service Act). A group health plan is
a plan that has 50 or more participants (as the term “participant”
is currently defined by section 3(7) of ERISA) or is administered
by an entity other than the employer that established and maintains
the plan. This definition includes both insured and self-insured
plans. We define “participant” separately below.
Section 2791(a)(1) of the Public Health Service Act defines “group
health plan” as an employee welfare benefit plan (as currently
defined in section 3(1) of ERISA) to the extent that the plan provides
medical care, including items and services paid for as medical care,
to employees or their dependents directly or through insurance,
or otherwise.
It should be noted that group health plans that have fewer than
50 participants and that are administered by the employer would
be excluded from this definition and would not be subject to the
administrative simplification provisions of HIPAA.
b. “Health insurance issuer” (as currently defined by
section 2791(b) of the Public Health Service Act).
Section 2791(b)(2) of the Public Health Service Act currently defines
a “health insurance issuer” as an insurance company, insurance
service, or insurance organization that is licensed to engage in
the business of insurance in a State and is subject to State law
that regulates insurance.
c. “Health maintenance organization” (as currently defined
by section 2791(b) of the Public Health Service Act).
Section 2791(b) of the Public Health Service Act currently defines
a “health maintenance organization” as a Federally qualified
health maintenance organization, an organization recognized as such
under State law, or a similar organization regulated for solvency
under State law in the same manner and to the same extent as such
a health maintenance organization. These organizations may include
preferred provider organizations, provider sponsored organizations,
independent practice associations, competitive medical plans, exclusive
provider organizations, and foundations for medical care.
d. Part A or Part B of the Medicare program (title XVIII of the
Act).
e. The Medicaid program (title XIX of the Act).
f. A “Medicare supplemental policy” as defined under
section 1882(g)(1) of the Act.
Section 1882(g)(1) of the Act defines a “Medicare supplemental
policy” as a health insurance policy that a private entity
offers a Medicare beneficiary to provide payment for expenses incurred
for services and items that are not reimbursed by Medicare because
of deductible, coinsurance, or other limitations under Medicare.
The statutory definition of a Medicare supplemental policy excludes
a number of plans that are generally considered to be Medicare supplemental
plans, such as health plans for employees and former employees and
for members and former members of trade associations and unions.
A number of these health plans may be included under the definitions
of “group health plan” or “health insurance issuer”,
as defined in a. and b. above.
g. A “long-term care policy,” including a nursing home
fixed-indemnity policy. A “long-term care policy” is considered
to be a health plan regardless of how comprehensive it is. We recognize
the long-term care insurance segment of the industry is largely
unautomated and we welcome comments regarding the impact of HIPAA
on the long-term care segment.
h. An employee welfare benefit plan or any other arrangement that
is established or maintained for the purpose of offering or providing
health benefits to the employees of two or more employers. This
includes plans and other arrangements that are referred to as multiple
employer welfare arrangements (“MEWAs”) as defined in
section 3(40) of ERISA.
i. The health care program for active military personnel under
title 10 of the United States Code.
j. The veterans health care program under chapter 17 of title 38
of the United States Code.
This health plan primarily furnishes medical care through hospitals
and clinics administered by the Department of Veterans Affairs for
veterans with a service-connected disability that is compensable.
Veterans with non-service-connected disabilities (and no other health
benefit plan) may receive health care under this health plan to
the extent resources and facilities are available.
k. The Civilian Health and Medical Program of the Uniformed Services
(CHAMPUS), as defined in 10 U.S.C. 1072(4).
CHAMPUS primarily covers services furnished by civilian medical
providers to dependents of active duty members of the uniformed
services and retirees and their dependents under age 65.
l. The Indian Health Service program under the Indian Health Care
Improvement Act (25 U.S.C. 1601 et seq.).
This program furnishes services, generally through its own health
care providers, primarily to persons who are eligible to receive
services because they are of American Indian or Alaskan Native descent.
m. The Federal Employees Health Benefits Program under 5 U.S.C.
chapter 89.
This program consists of health insurance plans offered to active
and retired Federal employees and their dependents. Depending on
the health plan, the services may be furnished on a fee-for-service
basis or through a health maintenance organization.
(Note: Although section 1171(5)(M) of the Act refers to the “Federal
Employees Health Benefit Plan,” this and any other rules adopting
administrative simplification standards will use the correct name,
the Federal Employees Health Benefits Program. One health plan does
not cover all Federal employees; there are over 350 health plans
that provide health benefits coverage to Federal employees, retirees,
and their eligible family members. Therefore, we will use the correct
name, the Federal Employees Health Benefits Program, to make clear
that the administrative simplification standards apply to all health
plans that participate in the Program.)
n. Any other individual or group health plan, or combination thereof,
that provides or pays for the cost of medical care.
We would include a fourteenth category of health plan in addition
to those specifically named in HIPAA, as there are health plans
that do not readily fit into the other categories but whose major
purpose is providing health benefits. The Secretary would determine
which of these plans are health plans for purposes of title II of
HIPAA. This category would include the Medicare Plus Choice plans
that will become available as a result of section 1855 of the Act
as amended by section 4001 of the Balanced Budget Act of 1997 (Public
Law 105-33) to the extent that these health plans do not fall under
any other category.
6. Medical care.
“Medical care,” which is used in the definition of health
plan, would be defined as current section 2791 of the Public Health
Service Act defines it: the diagnosis, cure, mitigation, treatment,
or prevention of disease, or amounts paid for the purpose of affecting
any body structure or function of the body; amounts paid for transportation
primarily for and essential to these items; and amounts paid for
insurance covering the items and the transportation specified in
this definition.
7. Participant.
We would define the term “participant” as section 3(7)
of ERISA currently defines it: a “participant” is any
employee or former employee of an employer, or any member or former
member of an employee organization, who is or may become eligible
to receive a benefit of any type from an employee benefit plan that
covers employees of such an employer or members of such organizations,
or whose beneficiaries may be eligible to receive any such benefits.
An “employee” would include an individual who is treated
as an employee under section 401(c)(1) of the Internal Revenue Code
of 1986 (26 U.S.C. 401(c)(1)).
8. Small health plan.
We would define a “small health plan” as a group health
plan with fewer than 50 participants.
The HIPAA does not define a “small health plan” but instead
leaves the definition to be determined by the Secretary. The Conference
Report suggests that the appropriate definition of a “small
health plan” is found in current section 2791(a) of the Public
Health Service Act, which is a group health plan with fewer than
50 participants. We would also define small individual health plans
as those with fewer than 50 participants.
9. Standard.
Section 1171 of the Act defines “standard,” when used
with reference to a data element of health information or a transaction
referred to in section 1173(a)(1) of the Act, as any such data element
or transaction that meets each of the standards and implementation
specifications adopted or established by the Secretary with respect
to the data element or transaction under sections 1172 through 1174
of the Act.
Under our definition, a standard would be a set of rules for a
set of codes, data elements, transactions, or identifiers promulgated
either by an organization accredited by the American National Standards
Institute or HHS for the electronic transmission of health information.
10. Transaction.
“Transaction” would mean the exchange of information
between two parties to carry out financial and administrative activities
related to health care. A transaction would be any of the transactions
listed in section 1173(a)(2) of the Act and any determined appropriate
by the Secretary in accordance with section 1173(a)(1)(B) of the
Act. We present them below in the order in which we propose to list
them in the regulations text to this document and in the regulations
document for proposed standards for these transactions that we will
publish later.
A “transaction” would mean any of the following:
a. Health claims or equivalent encounter information.
This transaction may be used to submit health care claim billing
information, encounter information, or both, from health care providers
to health plans, either directly or via intermediary billers and
claims clearinghouses.
b. Health care payment and remittance advice.
This transaction may be used by a health plan to make a payment
to a financial institution for a health care provider (sending payment
only), to send an explanation of benefits or a remittance advice
directly to a health care provider (sending data only), or to make
payment and send an explanation of benefits remittance advice to
a health care provider via a financial institution (sending both
payment and data).
c. Coordination of benefits.
This transaction can be used to transmit health care claims and
billing payment information between health plans with different
payment responsibilities where coordination of benefits is required
or between health plans and regulatory agencies to monitor the rendering,
billing, and/or payment of health care services within a specific
health care/insurance industry segment.
In addition to the nine electronic transactions specified in section
1173(a)(2) of the Act, section 1173(f) directs the Secretary to
adopt standards for transferring standard data elements among health
plans for coordination of benefits and sequential processing of
claims. This particular provision does not state that these should
be standards for electronic transfer of standard data elements among
health plans. However, we believe that the Congress, when writing
this provision, intended for these standards to apply to the electronic
form of transactions for coordination of benefits and sequential
processing of claims. The Congress expressed its intent on these
matters generally in section 1173(a)(1)(B), where the Secretary
is directed to adopt "other financial and administrative transactions
. . . consistent with the goals of improving the operation of the
health care system and reducing administrative costs". Adoption
of a standard for electronic transmission of standard data elements
among health plans for coordination of benefits and sequential processing
of claims would serve these goals expressed by the Congress.
d. Health claim status.
This transaction may be used by health care providers and recipients
of health care products or services (or their authorized agents)
to request the status of a health care claim or encounter from a
health plan.
e. Enrollment and disenrollment in a health plan.
This transaction may be used to establish communication between
the sponsor of a health benefit and the health plan. It provides
enrollment data, such as subscriber and dependents, employer information,
and primary care health care provider information. The sponsor is
the backer of the coverage, benefit, or product. A sponsor can be
an employer, union, government agency, association, or insurance
company. The health plan refers to an entity that pays claims, administers
the insurance product or benefit, or both.
f. Eligibility for a health plan.
This transaction may be used to inquire about the eligibility,
coverage, or benefits associated with a benefit plan, employer,
plan sponsor, subscriber, or a dependent under the subscriber’s
policy. It also can be used to communicate information about or
changes to eligibility, coverage, or benefits from information sources
(such as insurers, sponsors, and health plans) to information receivers
(such as physicians, hospitals, third party administrators, and
government agencies).
g. Health plan premium payments.
This transaction may be used by, for example, employers, employees,
unions, and associations to make and keep track of payments of health
plan premiums to their health insurers. This transaction may also
be used by a health care provider, acting as liaison for the beneficiary,
to make payment to a health insurer for coinsurance, copayments,
and deductibles.
h. Referral certification and authorization.
This transaction may be used to transmit health care service referral
information between primary care health care providers, health care
providers furnishing services, and health plans. It can also be
used to obtain authorization for certain health care services from
a health plan.
i. First report of injury.
This transaction may be used to report information pertaining to
an injury, illness, or incident to entities interested in the information
for statistical, legal, claims, and risk management processing requirements.
j. Health claims attachments.
This transaction may be used to transmit health care service information,
such as subscriber, patient, demographic, diagnosis, or treatment
data for the purpose of a request for review, certification, notification,
or reporting the outcome of a health care services review.
k. Other transactions as the Secretary may prescribe by regulation.
Under section 1173(a)(1)(B) of the Act, the Secretary shall adopt
standards, and data elements for those standards, for other financial
and administrative transactions deemed appropriate by the Secretary.
These transactions would be consistent with the goals of improving
the operation of the health care system and reducing administrative
costs.
C. Effective Dates - General
In general, any given standard would be effective 24 months after
the effective date (36 months for small health plans) of the final
rule for that standard. Because there are other standards to be
established than those in this proposed rule, we specify the date
for a given standard under the subpart for that standard.
If HHS adopts a modification to an implementation specification
or a standard, the implementation date of the modification would
be no earlier than the 180th day following the adoption of the modification.
HHS would determine the actual date, taking into account the time
needed to comply due to the nature and extent of the modification.
HHS would be able to extend the time for compliance for small health
plans. This provision would be at § 142.106.
The law does not address scheduling of implementation of the standards;
it gives only a date by which all concerned must comply. As a result,
any of the health plans, health care clearinghouses, and health
care providers may implement a given standard earlier than the date
specified in the subpart created for that standard. We realize that
this may create some problems temporarily, as early implementers
would have to be able to continue using old standards until the
new ones must, by law, be in place.
At the WEDI Healthcare Leadership Summit held on August 15, 1997,
it was recommended that health care providers not be required to
use any of the the standards during the first year after the adoption
of the standard. However, willing trading partners could implement
any or all of the standards by mutual agreement at any time during
the 2-year implementation phase (3- year implementation phase for
small health plans). In addition, it was recommended that a health
plan give its health care providers at least 6 months notice before
requiring them to use a given standard.
We welcome comments specifically on early implementation as to
the extent to which it would cause problems and how any problems
might be alleviated.
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