How NPI info leads to denials

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For most physicians, our NPI number is something we barely think about. It was assigned back in residency, and outside of calling in a prescription here and there, it rarely comes up. In fact, many of us don’t even know our number off the top of our heads and have to Google it every time.

But here’s the problem: when misunderstanding its importance collides with the complex bureaucracy of billing and information transfer, it creates inconsistencies. And those inconsistencies can lead to sneaky insurance denials.

If your hospital departments are siloed and not identifying trends, those denials can quietly drain significant revenue.

More Than Just a Number

It’s not the NPI number itself that’s the issue. It’s the information tied to it. CMS and health insurers use NPI records to uniquely identify physicians for billing. Alongside the NPI number and other information, the record contains details like:

• Entity type (individual vs group)

• Business address

• Credentials

• Primary taxonomy classification

Any incorrect or outdated detail can trigger a denial.

One field in particular causes trouble: Primary Taxonomy Code.

Why Taxonomy Matters

Your primary taxonomy code is your official “specialty of record:” hospitalist, pulmonologist, infectious disease, and so on. If it’s wrong or outdated, insurers may see a mismatch between what you bill and what actually happened, leading to denials.

Here’s a real-world example:
An internal medicine resident is assigned the taxonomy of “internal medicine physician.” Years later, they complete a pulmonology fellowship, but their taxonomy is never updated. When they start billing as a pulmonologist, the system still shows them as internal medicine.

When that pulmonologist consults on a patient who is also being seen by a hospitalist, to the health insurance company, both appear to be internal medicine physicians. Since two physicians of the same specialty generally cannot bill for E&M on the same patient, same day, the claim for the consult gets denied.

As I’ve discussed in a previous newsletter about E&M billing, billing is impacted by your specialty and sub-specialty. A general cardiologist and an EP cardiologist can each bill separately if they both see the patient on the same day. But if the EP cardiologist never updated their primary taxonomy code, both appear as general cardiologists, and once again, the payer denies the second claim. If you’re RVU-based, that’s money you never see.

The issue gets even trickier when fellows moonlight as hospitalists, then transition into specialty roles, or when they split time between hospitalist and specialty shifts.

Why This Matters Outside the Hospital

Even in independent practice, your NPI profile carries weight. Many online directories pull from the NPPES system (ya know, those online resources that know your business address, phone number, training information and you have no idea how - yeah that’s from the NPPES system).

Anyway, if you’re an independent physician, make sure that business address and phone number are accurate, so patients know how to find you. Also, make sure your personal address and phone number are not listed!

How to Fix It

To ensure your information is correct, do this:

1. Go to the NPPES website.

2. Select the blue button on the right: “create or manage an account.” This takes you to CMS’s login page.

3. Set up your login credentials, then return to the NPPES site.

4. Update your information, especially your primary taxonomy specialty and your business address.

If you find errors that need to be corrected, contact your medical staff office and push them to fix onboarding gaps so this doesn’t keep happening. CMS even allows surrogates to be assigned to handle updates on your behalf.

A Word to Credentialing and Medical Staff Offices

Please don’t put the full burden of this on physicians. Many of us have never heard of NPPES (or did once and have simply forgotten). Simply sending an email that says “update your info” isn’t enough.

Most don’t understand the “why.” We don’t live in the world of administrative bureaucracy. We live in the world of patient care and keeping up with the latest medical updates. If you want this fixed, make it easy. Build systematic onboarding processes, help physicians navigate the updates, and confirm the data gets corrected.

I once saw a denial issue drag on for a full year because everyone was pointing fingers and no one took ownership. When it finally landed on my desk, I called the physician, walked them through the update, and the entire problem was solved in 10 minutes.

That’s how simple the solution can be, but you should have processes in place to ensure it never happens in the first place.

Liked this newsletter? Share your thoughts in the comments, or on Linkedin!

That’s all for now. Cheers,

Robert

Thank you to Laura Samson, RN BSN CCDS and Kristi Knight, RN CPC CPPM CCDS-O for reviewing this newsletter!

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