What Are the Health Care Provider NPI Categories?
There are two categories of health care providers for NPI enumeration purposes: Entity Type 1 (Individual) and Entity Type 2 (Organization).
Entity Type 1: Individual Health Care Providers, Including Sole Proprietors
Individual health care providers may receive NPIs as Entity Type 1. As a sole proprietor, you must apply for the NPI using your own Social Security Number (SSN), not an Employer Identification Number (EIN) even if you have an EIN.
As a sole proprietor, you may receive only one NPI, just like any other individual. For example, if a physician is a sole proprietor, the physician may receive only one NPI (the individual’s NPI). The following factors do not affect whether a sole proprietor is an Entity Type 1:
- Number of different office locations
- Whether you have employees
- Whether the Internal Revenue Service (IRS) issued an EIN to you so your employees’ W-2 forms can reflect the EIN instead of your Taxpayer Identification Number (which is your SSN)
NOTE: A sole proprietor is not an incorporated individual because the sole proprietor did not form a corporation. If you are a sole practitioner or solo practitioner, it does not necessarily mean you are a sole proprietor, and vice versa.
Entity Type 2: Organization Health Care Providers
Organization health care providers are group health care providers and
are eligible for NPIs as Entity Type 2. Organization health care providers may have a single employee or thousands of employees. For example, an incorporated individual may be the only health care provider employed by that organization provider (the corporation that he or she formed).
Some organization health care providers are made up of components that function somewhat independently from their “parent” organization. These components may furnish different types of health care or have separate physical locations where health care is furnished. These components and their physical locations are not themselves legal entities, but are part of the organization health care provider (which is a legal entity). The NPI Final Rule refers to the components and locations as subparts.
An organization health care provider can get its subparts their own NPIs. If a subpart conducts any HIPAA standard transactions on its own (that is, separately from its parent), it must obtain its own NPI.
Subpart determination ensures that entities within a covered organization are uniquely identified in HIPAA standard transactions they conduct with Medicare and other covered entities. For example, a hospital offers acute care, laboratory, pharmacy, and rehabilitation services. Each of these subparts may require its own NPI because each one sends its own standard transactions to one or more health plans.
NOTE: Subpart delegation does not affect Entity Type 1 health care providers. As individuals, these health care providers cannot designate subparts, and cannot be considered subparts.