November 2006 Newsletter

Medicare Claims Get More Taxing

By: EDI Project Leader

With the implementation of NPI as the means to identify Providers and Physicians, a new problem has arisen. Since there is no “embedded” intelligence in an NPI number (i.e. you can no longer tell whether the provider is a subunit or a certain kind of facility, the provider’s state, etc.), Medicare will be requiring the use of a Taxonomy Code on Institutional claims to further qualify a provider of service, effective January 1, 2007.

The new UB-04 claim form has a field (Block 81, which is the new CODE-CODE field) that can be used to report this information. Block 81 can be used to report the Taxonomy Code by incorporating a Qualifier Code (B3) in Block 81A.

According to the CMS Transmittal #1024 (dated August 4, 2006), the Taxonomy Code should be reported on all claims effective January 1, 2007. In our continual effort to be proactive, Quadax has already modified our Xpeditor software to perform the following tasks:

• If there is no Taxonomy Code on the claim and the legacy Medicare Provider Number (OSCAR #) is present on the claim, Xpeditor will compare the last four digits of the Provider Number to the chart supplied by CMS (via the Transmittal) and will transmit the appropriate Taxonomy Code in the ANSI format.
• If there is no Taxonomy Code and no legacy number, the default Taxonomy Code 282N00000X will be used on the ANSI output.
• If a Taxonomy Code is present on the claim (Block 81 on the UB-04), it will be used to break the batch in the ANSI format and will be sent out accordingly.

Be sure to check other Quadax publications (such as Connections) for further developments on this issue.