Q&A: Who needs an NPI?

We are a small, rural pediatric practice that sends no claims to Medicare. In addition, we don't submit any claims electronically. As such, it is my understanding that the Health Insurance Portability and Accountability Act does not apply to us, and we're not required to obtain a National Provider Identifier. But we have experienced claim rejections because we don't have an NPI, and even though we try to explain our situation to representatives of the insurers, they still insist we need an NPI for our claims to be processed successfully. Can you help?

Technically, if you don't conduct standard transactions adopted under HIPAA-claims, eligibility inquiries, claims-status inquiries, prior authorizations, and referrals by paper, fax, or telephone-you are not a covered health-care provider; therefore, you don't need an NPI number. Unfortunately, the final rule that requires insurers to process claims with an NPI has created the necessity to have one. Many insurers, including Medicare, will not process claims without an NPI. In addition, the requirement to identify the referring physician by his or her NPI really means everyone needs to obtain one. According to CMS, you can apply for an NPI online, and the estimated time to complete the application is 20 minutes.