CMS Publishes HIPAA Guidance
(February 21, 2006)

The Centers for Medicare and Medicaid Services has published two new frequently asked questions related to the HIPAA administrative simplification rules.

The questions, on CMS' redesigned--and nonuser-friendly Web site--are not easy to find. They are presented below in their entirety.

One new FAQ is ID #6594, pertaining to what type of business structures are considered organizations under the national provider identifier. What follows is the full question and answer.

Q: "What types of business structures are considered organization health care providers and thus eligible for organization NPIs? What types are not?"

A: "A sole proprietorship is a form of business in which one person owns all of the assets of the business and is solely liable for all the debts of the business in an individual capacity. Therefore, sole proprietorships are not considered organization health care providers for purposes of the NPI final rule and thus cannot get organization NPIs. In terms of NPI assignment, a sole proprietor would be an Entity Type 1 (individual) and would be eligible for a single NPI. As an 'Individual,' the sole proprietor cannot have a subpart and cannot designate subparts.

"State laws enable the creation of many other different types of businesses. While we cannot address every possible type of business structure, we apply the following broad principle to determine whether a business is eligible for an organization NPI. Any organization that is recognized by the state as separate and distinct from the individual is eligible for an organization NPI. The law in each state will govern how different business types are recognized by the state."

The second new FAQ is Item #6595, pertaining to certain electronic transactions for which HIPAA standards have not been adopted. The full question and answer follows.

Q: "Many business transactions are currently performed for which HIPAA standards have not yet been adopted. For example, although there are proposed claims attachment standards, no final standards have been adopted. In the absence of a final rule, may trading partners agree to use electronic transactions and attachments such as the X12 277/275 pair and the HL7 Clinical Document Architecture Release 2 (CDA R2) to support both business-to-business processes and clinical-to-business processes until the HIPAA standards for electronic health care claims attachments are adopted?"

A: "Yes. In the absence of an applicable final HIPAA standard, willing trading partners may use any appropriate industry standard to conduct a transaction, in accordance with a governing trading partner agreement. If the transaction is not governed by HIPAA, another federal requirement (such as an adopted e-prescribing standard), or any state law, the trading partners can agree to use X12 and HL7 standards, for instance, to request and submit additional documentation to support a claim, or to submit additional documentation to support an authorization, presuming that they also comply with applicable HIPAA privacy and security standards."

To locate HIPAA questions, go to Click on Site-wide Tools and Resources, then Frequently Asked Questions, then Regulation and Guidance in the section box, then HIPAA Administrative Simplification in the category box, then Educational Materials in the sub category space. To then narrow the search from 2,400 entries, enter specific terms, such as NPI or Attachments, in the Search Term box. Also, item identifiers can be entered into the search box if these identifiers are known.

Posted to HIPAAcomply 2/16/06