CMS Pub. 100-08, ch. 10, § 10.6.5

A. Submission of NPI

Every provider or supplier that submits an enrollment application must furnish its NPI(s) in the

applicable section(s) of the Form CMS-855 or CMS-20134. The provider need not submit a

copy of the NPI notification it received from the National Plan and Provider Enumeration

System (NPPES) because PECOS will verify the NPIs of the provider/supplier and all other NPIs

listed on the application.

B. Additional NPI Information

The contractor shall only enter NPI data into PECOS that is submitted in conjunction with a

Form CMS-855 or CMS-20134 (e.g., initial, change request). Thus, if a provider submits a Form

CMS-855 or CMS-20134 change of information that only reports the provider’s newly assigned

NPI, or reports multiple NPIs that need to be associated with a single Medicare identification

number, the contractor may treat this as a change request and enter the data into PECOS.

C. Subparts - General

The contractor shall review and become familiar with the principles outlined in the “Medicare

Expectations Subpart Paper,” the text of which follows below. It was originally issued in

January 2006 and has since been slightly updated to reflect certain changes in Medicare

terminology.

CMS encourages all providers to obtain NPIs in a manner similar to how they receive CMS

Certification Numbers (CCNs) (i.e., a “one-to-one relationship”). For instance, suppose a home

health agency is enrolling in Medicare. It has a branch as a practice location. The main provider

and the branch will typically receive separate (albeit very similar) CCNs. It would be advisable

for the provider to obtain an NPI for the main provider and another one for the branch – that is,

one NPI for each CCN.

D. Medicare Subparts Paper - Text

MEDICARE EXPECTATIONS ON DETERMINATION OF SUBPARTS

BY MEDICARE ORGANIZATION HEALTH CARE PROVIDERS WHO ARE

COVERED ENTITIES UNDER HIPAA

Purpose of this Paper

Medicare assigns unique identification numbers to its enrolled health care providers. They are

used to identify the enrolled health care providers in the HIPAA standard transactions that they

conduct with Medicare (such as electronic claims, remittance advices, eligibility

inquiries/responses, claim status inquiries/responses, and coordination of benefits) and in cost

reports and other non-standard transactions.

This paper is a reference for Medicare contractors. It reflects the Medicare program’s

expectations on how its enrolled organization health care providers that are covered entities

under HIPAA1 will determine subparts and obtain NPIs for themselves and any subparts. These

1 Covered entities under HIPAA are health plans, health care clearinghouses, and those health care

providers who transmit any health information in electronic form in connection with a health transaction

for which the Secretary of HHS has adopted a standard (referred to in this paper as HIPAA standard

expectations may change over time to correspond with any changes in Medicare statutes,

regulations, or policies that affect Medicare provider enrollment.

These expectations are based on the NPI Final Rule, on statutory and regulatory requirements

with which Medicare must comply, and on policies that are documented in Medicare operating

manuals and other directives. These Medicare statutes, regulations and policies pertain to

conditions for provider participation in Medicare, enrollment of health care providers in

Medicare and assignment of identification numbers for billing and other purposes, submission of

cost reports, calculation of payment amounts, and the reimbursement of enrolled providers for

services furnished to Medicare beneficiaries.

This paper categorizes Medicare’s enrolled organization health care providers as follows:

• Certified providers and certified suppliers

• Supplier groups and supplier organizations

• Suppliers of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS)

This paper is not intended to serve as official HHS guidance to the industry in determining

subparts for any covered health care providers other than those that are organizations and are

enrolled in the Medicare program. This paper does not address health care providers who are

enrolled in Medicare as individual practitioners. These practitioners are Individuals (such as

physicians, physician assistants, nurse practitioners, and others, including health care providers

who are sole proprietors). In terms of NPI assignment, an Individual is an Entity Type 1

(Individual) and is eligible for a single NPI. As Individuals, these health care providers cannot

be subparts and cannot designate subparts. A sole proprietorship is a form of business in which

one person owns all of the assets of the business and the sole proprietor is solely liable for all of

the debts of the business. There is no difference between a sole proprietor and a sole

proprietorship. In terms of NPI assignment, a sole proprietor/sole proprietorship is an Entity

Type 1 (Individual) and is eligible for a single NPI. As an Individual, a sole proprietor/sole

proprietorship cannot have subparts and cannot designate subparts.

Discussion of Subparts in the NPI Final Rule and its

Applicability to Enrolled Medicare Organization Health Care Providers

The NPI Final Rule adopted the National Provider Identifier (NPI) as the standard unique health

identifier for health care providers for use in HIPAA standard transactions. On or before May

23, 2007, all HIPAA covered entities (except small health plans), to include enrolled Medicare

providers and suppliers that are covered entities, were required to obtain NPIs and to use their

NPIs to identify themselves as “health care providers” in the HIPAA standard transactions that

they conduct with Medicare and other covered entities. Covered organization health care

providers are responsible for determining if they have “subparts” that need to have NPIs. If such

subparts exist, the covered organization health care provider must ensure that the subparts obtain

their own unique NPIs, or they must obtain them for them.

transactions). Most Medicare Organization health care providers send electronic claims to Medicare (they

are HIPAA standard transactions), making them covered health care providers (covered entities).

The NPI Final Rule contains guidance for covered organization health care providers in

determining subparts. Subpart determination is necessary to ensure that entities within a covered

organization health care provider that need to be uniquely identified in HIPAA standard

transactions obtain NPIs for that purpose.

The following statements apply to all entities that could be considered subparts:

• A subpart is not itself a separate legal entity, but is a part of a covered organization health

care provider that is a legal entity. (All covered entities under HIPAA are legal entities.)

• A subpart furnishes health care as defined at 45 CFR § 160.103.

The following statements may relate to some or all of the entities that a Medicare covered

organization health care provider could consider as subparts:

• A subpart may or may not be located at the same location as the covered organization

health care provider of which it is a part.

• A subpart may or may not have a Taxonomy (Medicare specialty) that is the same as the

covered organization health care provider of which it is a part.

• Federal statutes or regulations pertaining to requirements for the unique identification of

enrolled Medicare providers may relate to entities that could be considered subparts

according to the discussion in the NPI Final Rule. Medicare covered organization health

care providers must take any such statutes or regulations into account to ensure that, if

Medicare providers are uniquely identified now by using Medicare identifiers in HIPAA

standard transactions, they obtain NPIs in order to ensure they can continue to be

uniquely identified. Medicare is transitioning from the provider identifiers it currently

uses in HIPAA standard transactions (for organizations, these could be CCNs, Provider

Transaction Access Numbers (PTANs)—known as legacy identifiers or legacy numbers)

to NPIs. This makes it necessary that Medicare organization health care providers obtain

NPIs because the NPIs have replaced the identifiers currently in use in standard

transactions with Medicare and with all other health plans. In addition, Medicare

organization health care providers must determine if they have subparts that need to be

uniquely identified for Medicare purposes (for example, in HIPAA standard transactions

conducted with Medicare). If that is the case, the subparts will need to have their own

unique NPIs so that they can continue to be uniquely identified in those transactions.

• A subpart that conducts any of the HIPAA standard transactions separately from the

covered organization health care provider of which it is a part must have its own unique

NPI.

Enrolled Medicare organization health care providers that are covered entities under HIPAA

must apply for NPIs as Organizations (Entity Type 2). Organization health care providers as

discussed in this paper are corporations or partnerships or other types of businesses that are

considered separate from an individual by the State in which they exist. Subparts of such

organization health care providers who apply for NPIs are also Organizations (Entity Type 2).

Medicare Statutes, Regulations, Manuals

The Social Security Act (sections 1814, 1815, 1819, 1834, 1861, 1865, 1866, and 1891) and

Federal regulations (including those at 42 CFR 400.202, 400.203, 403.720, 405.2100, 409.100,

410.2, 412.20, 416.1, 418.1, 424, 482.1, 482.60, 482.66, 483, 484, 485, 486, 489, 491, and

493.12) establish, among other things, the Conditions for Participation for Medicare providers

and set requirements by which Medicare enrolls providers, requires cost reports, calculates

reimbursement, and makes payments to its providers. These Medicare statutory and regulatory

requirements are further clarified in various Medicare operating manuals, such as the State

Operations Manual and the Program Integrity Manual, in which requirements and policies

concerning the assignment of unique identification numbers, for billing and other purposes, are

stated.

Medicare Organization Providers and Subparts:

Certified Providers and Certified Suppliers

Existing Medicare laws and regulations do not establish requirements concerning the assignment

of unique identification numbers to Medicare certified providers and certified suppliers for

billing purposes.

Certified Providers that bill Medicare Part A (hereinafter referred to as “providers”):

• Providers apply for Medicare enrollment by completing a Form CMS-855A.

• Most providers are surveyed and certified by the States3 prior to being approved as Medicare

providers.2

• Providers have in effect an agreement to participate in Medicare.

• Providers include, but are not limited to: skilled nursing facilities, hospitals4, critical access

hospitals, home health agencies, rehabilitation agencies (outpatient physical therapy, speech

therapy), comprehensive outpatient rehabilitation facilities, hospices, community mental

health centers, religious non-medical health care institutions.

• Providers are assigned CCNs to identify themselves in Medicare claims and other

transactions, including cost reports for those providers that are required to file Medicare cost

reports.

• In general, each entity that is surveyed and certified by a State is separately enrolled in

Medicare and is considered a Medicare provider. (One exception involves home health

agency branches. The branches are not separately enrolled Medicare providers.) In many

cases, the enrolled provider is not itself a separate legal entity; i.e., it is an entity that is a part

2 Religious non-medical health care institutions are handled differently.

3 Hospitals bill Medicare Part B for certain types of services. 4 The check-digit algorithm will determine the validity of an NPI.

This is not the same as knowing the health care provider being identified by a particular NPI.

of an enrolled provider that is a legal entity and is, for purposes of the NPI Final Rule,

considered to be a subpart.

Certified Suppliers, which bill Medicare Part B:

• Certified suppliers apply for Medicare enrollment by completing a Form CMS-855A or

CMS-855B, depending on the supplier type.3

• Certified suppliers include ambulatory surgical centers, portable x-ray suppliers, independent

clinical labs (CLIA labs), rural health centers, and federally qualified health centers.

• Certified suppliers are typically surveyed and certified by the States prior to being approved

for enrollment as Medicare certified suppliers. (For CLIA labs, each practice location at

which lab tests are performed must obtain a separate CLIA Certificate for that location,

though there are a few exceptions to this.)

• Certified suppliers may have in effect an agreement to participate in Medicare.

• Certified suppliers are assigned CCNs for purposes of identification within Medicare

processes. However, the contractors assign unique identification numbers to certain certified

suppliers for billing purposes. (For CLIA labs, a CLIA number is typically assigned to each

practice location for which a CLIA certificate is issued. A CLIA number may not be used to

identify a clinical laboratory as a “health care provider” in HIPAA standard transactions.

The CLIA number has no relation to the Medicare PTAN.)

• In many cases, the enrolled certified supplier is not itself a separate legal entity; i.e., it is an

entity that is a part of an enrolled provider or certified supplier that is a legal entity and is, for

purposes of the NPI Final Rule, considered to be a subpart.

In general, Medicare bases its enrollment of providers and certified suppliers on two main

factors: (1) whether a separate State certification or survey is required, and (2) whether a

separate provider or certified supplier agreement is needed. (The Taxpayer Identification

Number, or TIN, is a consideration as well, though not to the degree of the two main factors.)

The CMS Survey & Operations Group (SOG) Location generally make the final determinations

on both of these factors; hence, Medicare provider and certified supplier enrollment policy is

dictated to a significant degree by the CMS regional offices’ decisions in particular cases.

Medicare Expectations for NPI Assignments for Providers and Certified Suppliers: To

help ensure that Medicare providers and certified suppliers do not experience denials of claims or

delays in Medicare claims processing or reimbursement, Medicare encourages each of its

enrolled providers and certified suppliers to obtain its own unique NPI. These NPIs have

replaced the legacy numbers that are used today in HIPAA standard transactions and in other

transactions, such as cost reports. In order for subpart determinations to mirror Medicare

enrollment, each enrolled provider and certified supplier that is a covered organization health

care provider should:

• Obtain its own unique NPI.

• Determine if it has any subparts that are themselves enrolled Medicare providers. If there are

subparts, ensure that they obtain their own unique NPIs, or obtain the NPIs for them.

Example: An enrolled provider (a hospital) owns 10 home health agencies, all operating

under the TIN of the hospital. Because the hospital and each of the 10 home health agencies

is separately surveyed and enters into its own provider agreement with Medicare, a total of

11 unique NPIs should be obtained: one for the hospital, and one for each of the 10 home

health agencies.

Regardless of how an enrolled provider or certified supplier that is a covered organization health

care provider determines subparts (if any) and obtains NPIs (for itself or for any of its subparts, if

they exist), Medicare payments, by law, may be made only to an enrolled provider or certified

supplier.

Medicare Organization Providers and Subparts:

Supplier Groups and Supplier Organizations

Existing Medicare laws and regulations do not establish requirements concerning the assignment

of unique identification numbers to supplier groups and supplier organizations for billing

purposes.

• Supplier groups and supplier organizations apply for Medicare enrollment by completing a

Form CMS-855B or CMS-20134.

• Supplier groups and supplier organizations bill Medicare Part B.

• Certain supplier organizations are certified by the States, certified by the Food and Drug

Administration (FDA), or must undergo an on-site inspection by the contractor. These

requirements vary by type of supplier organization.

• Supplier groups are primarily group practices, such as a group of physicians or other

practitioners.

• Supplier organizations include ambulance companies, mammography facilities,

independent diagnostic testing facilities (IDTFs) and MDPP Suppliers.

Medicare enrolls supplier groups/supplier organizations based on TINs. A supplier group or

supplier organization may have multiple locations; however, if each location operates under the

same single TIN, Medicare does not separately enroll each location. There are exceptions:

1. When there is more than one Medicare specialty code associated with a single TIN. For

instance, if a physician group practice is also an IDTF, it has two different Medicare specialties.

The supplier group (the physician group practice) must enroll as a group and the supplier

organization (the IDTF) must enroll as a supplier organization. The group practice would

complete a Form CMS-855B and the IDTF would complete a Form CMS-855B. Each one

would receive its own unique Medicare identification number.

2. If a separate site visit, state certification, or on-site inspection by the contractor or if FDA

certification is required for each practice location of that supplier group/supplier organization.

In these above exceptions, Medicare separately enrolls each different Medicare specialty and

each separately visited, certified or contractor-inspected practice location.

Medicare Expectations for NPI Assignments for Supplier Groups and Supplier

Organizations: To help ensure that Medicare supplier groups and supplier organizations do not

experience delays in Medicare claims processing or reimbursement, Medicare encourages each

of its enrolled supplier groups and supplier organizations to obtain its own unique NPI. These

NPIs have replaced the legacy numbers that are used today in HIPAA standard transactions and

in other transactions, such as cost reports. In order for subpart determinations to mirror

Medicare enrollment, each enrolled supplier group and supplier organization that is a covered

organization health care provider should ensure the following:

• Obtain its own unique NPI.

• Determine if it has any subparts that are themselves enrolled Medicare providers. If

there are subparts, ensure that they obtain their own unique NPIs, or obtain the NPIs for

them.

EXAMPLE: An enrolled IDTF has four different locations, and each one must be separately

inspected by the contractor. All four locations operate under a single TIN. Because each

location is separately inspected in order to enroll in Medicare, a total of four unique NPIs should

be obtained: one for each location.

Regardless of how an enrolled supplier group or supplier organization that is a covered

organization health care provider determines subparts (if any) and obtains NPIs (for itself or for

any of its subparts, if they exist), Medicare payments, by law, may be made only to an enrolled

supplier group or supplier organization.

Medicare Organization Providers and Subparts: DMEPOS Suppliers

Medicare regulations require that each practice location of a supplier of DMEPOS (if it has more

than one) must, by law, be separately enrolled in Medicare and have its own unique Medicare

identification number.

• A supplier of DMEPOS enrolls in Medicare by completing a Form CMS-855S.

• Suppliers of DMEPOS bill Durable Medical Equipment Medicare Administrative

Contractors (DME MACs).

• Suppliers of DMEPOS include but are not limited to pharmacies, oxygen

suppliers, and outpatient physical therapy agencies. (Any organization that sells

equipment or supplies that are billed to Medicare through the DME MAC must be

enrolled as a supplier of DMEPOS via the appropriate NPE contractor.

Sometimes, these are organizations that also furnish services that are covered by

Medicare, such as ambulatory surgical centers. In order to be reimbursed for the

DME supplies that they sell, they must separately enroll in Medicare as a supplier

of DME.)

Medicare Expectations for NPI Assignments for Suppliers of DMEPOS: Each enrolled

supplier of DMEPOS that is a covered entity under HIPAA must designate each practice location

(if it has more than one) as a subpart and ensure that each subpart obtains its own unique NPI.

Final Notes About NPIs

Enrolled organization health care providers or subparts that bill more than one Medicare

contractor: An enrolled organization health care provider or subpart is expected to use a single

(the same) NPI when billing more than one Medicare contractor. For example, a physician

group practice billing Contractor X and also billing Contractor Y would use a single (the same)

NPI to bill both contractors.

Enrolled organization health care providers or subparts that bill more than one type of

Medicare contractor: Generally, the type of service being reported on a Medicare claim

determines the type of Medicare contractor that processes the claim. Medicare will expect an

enrolled organization health care provider or subpart to use a single (the same) NPI when billing

more than one type of Medicare contractor. However, in certain situations, Medicare requires

that the organization health care provider (or possibly even a subpart) enroll in Medicare as more

than one type of provider. For example, an ambulatory surgical center enrolls in Medicare as a

certified supplier and bills a Part A/B MAC. If the ambulatory surgical center also sells durable

medical equipment, it must also enroll in Medicare as a supplier of DME and bill a DME MAC.

This ambulatory surgical center would obtain a single NPI and use it to bill the A/B MAC and

the DME MAC. Medicare expects that this ambulatory surgical center would report two

different Taxonomies when it applies for its NPI: (1) that of ambulatory health care facility—

clinic/center--ambulatory surgical (261QA1903X) and (2) that of suppliers—durable medical

equipment & medical supplies (332B00000X) or the appropriate sub-specialization under the

332B00000X specialization.

Enrolled organization health care providers that determine subparts for reasons unrelated

to Medicare statutes, regulations or policies:

Consistent with the NPI Final Rule, covered organization health care providers designate

subparts for reasons that are not necessarily related to Medicare statutes or regulations. If a

Medicare organization health care provider designates as subparts entities other than those that

are enrolled Medicare providers, and those subparts obtain their own NPIs and use those NPIs to

identify themselves in HIPAA standard transactions with Medicare, those NPIs will not identify

enrolled Medicare providers. Medicare is not required to enroll them. (NPI Final Rule, page

3441: “If an organization health care provider consists of subparts that are identified with their

own unique NPIs, a health plan may decide to enroll none, one, or a limited number of them (and

to use only the NPIs of the one(s) it enrolls.”))

Medicare uses NPIs to identify health care providers and subparts in HIPAA standard

transactions. (NPI Final Rule, page 3469: section 162.412(a): “A health plan must use the NPI

of any health care provider (or subpart(s), if applicable) that has been assigned an NPI to identify

that health care provider on all standard transactions where that health care provider’s identifier

is required.”) Medicare ensures that the NPIs it receives in HIPAA standard transactions are

valid5. Medicare rejects HIPAA standard transactions that contain invalid NPIs. Valid NPIs,

however, like the provider identifiers used today, must be “known” to Medicare. Medicare is not

permitted to make payments for services rendered by non-Medicare providers, nor is it permitted

to reimburse providers that are not enrolled in the Medicare program. Medicare returns, with

appropriate messages, any HIPAA standard transactions containing valid but unrecognizable

NPIs.4