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July 13, 2016

The Secret Power of the NPI

Summary:

The seemingly insignificant NPI code can fight medical fraud and have a positive impact on workers’ comp medical management.

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This is a David and Goliath story about how the seemingly insignificant NPI code can fight medical fraud and have a positive impact on workers’ comp medical management. Many in the industry consider the NPI irrelevant. Yet it is a powerful factor in medical management and medical fraud detection.

The NPI is the National Provider Identifier assigned by CMS (Centers for Medicare and Medicaid Services) to individual medical providers and organizations that deliver medical services. It is required on bills for Medicare and Medicaid. Individual medical providers and medical groups must include their NPI on all bills submitted.

If the NPI is required for Medicare and Medicaid reimbursement, it follows that probably all medical doctors have an NPI number from CMS that uniquely identifies them. The problem is that many workers’ compensation payers do not ask for the NPI, do not require it and, even when the NPI is available, do not record it or transfer it to the next level.

Some, but not all, states require the NPI on workers’ comp bills. However, even if it is added to the bill, the use often goes no further.

The value of the NPI is that it uniquely identifies individual medical doctors. It carves out individual treating physicians in groups, organizations and facilities. Without the NPI associated with individuals, all those in a group are lumped together under the organization’s NPI or, worse, the entity’s tax ID. This matters. The assumption is that all members of the group practice in exactly the same way. But they do not.

The ability to parse individuals from groups in the data is essential to fair performance analysis. Individual differences seen in the data can be distinguished, even when associated with a group with individual NPIs. This is essential to creating quality preferred provider networks and directories. It is also indispensable for leveraging the data to create a teaching platform for improving provider performance in workers’ comp.

See also: Easy Way to Spot Workers’ Comp Fraud  

Physicians should be given the opportunity to see themselves portrayed in graphic reports comparing their performance to others like them. By nature, they are high achievers, and they want to show well. The graphic presentations are targets or guides for improvement.

Simply paying attention to a treating doctor in this objective manner will result in behavior change! Using the comparative data is invaluable, but success depends on accurately identifying individuals in the data using the individual NPI.

Another valuable use of the NPI is to assign medical specialties to individuals. Professional specialties can be obtained electronically from CMS databases using the NPI. Specialty is yet another data element missing in much of the bill review and claim system data. If the NPI number is available, specialties can be derived.

Specialties are important so that treating doctors are grouped with other doctors who are similarly prepared and licensed. The argument from doctors that they only treat the more difficult cases is nullified when they are compared only with others in their specialty. The best example is pain management specialists, who really do treat the more difficult cases. Their performance should always be compared with other pain specialists.

Unfortunately, there are those who twist the positive aspects of the NPI for fraudulent purposes. Close examination of the data reveals that less reputable medical doctors and other providers obtain multiple NPI numbers, using them in different locations or situations to deliberately obfuscate the data.

When multiple NPI numbers are fraudulently used, the door is open to undetectable duplicate billing. Systems cannot recognize overall performance for the individual because their performance is fragmented across multiple NPIs. To accurately analyze performance for an individual, all treatment incidences should be combined for one practitioner, thereby creating a critical mass of data for that individual.

While some will think the focus on NPI is much ado about nothing, it is not. Individual NPI numbers on all medical bills is essential; payers should insist on it. In fact, reimbursement should be withheld until the correct information is included on the bill as is done in Medicare.

See also: States of Confusion: Workers Comp Extraterritorial Issues 

Treating doctors not only drive direct medical costs but also indemnity costs, return to work and disability ratings at the end of the claim. They can also influence legal involvement. Consequently, finding the best doctors and avoiding the bad ones is crucial.

The way to determine who should be included in quality medical provider networks is to analyze past performance based on the data. The only way to accurately analyze performance is to identify individual treating doctors in the data and evaluate their performance across multiple claims based on the relevant performance factors. Correct NPI numbers included on medical bills are essential.

Workers’ comp payers must require correct individual NPI numbers on all medical bills. This is not an outrageous demand and does not add to costs. However, it does require attention to the matter. The benefits are too great to miss this simple yet powerful opportunity.

The simple little NPI is a powerful element in workers’ compensation medical management. It is the David that can effectively and affordably fight the medical fraud Goliath.

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About the Author

Karen Wolfe is founder, president and CEO of MedMetrics. She has been working in software design, development, data management and analysis specifically for the workers’ compensation industry for nearly 25 years. Wolfe’s background in healthcare, combined with her business and technology acumen, has resulted in unique expertise.

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