NUCC Taxonomy Codes Vs. Medicares 2-Digit Specialty Codes
January 23rd, 2010 - Seth Canterbury, CPC, ACS-EM
The NUCC Taxonomy Codes vs. Medicare's 2-digit Specialty Codes
The National Uniform Claim Committee (NUCC) maintains a list of 10-digit “health care provider taxonomy codes.” A provider must select a code for him/herself when applying for an NPI number. Should these codes be used to identify physicians of separate “specialties” for claims processing purposes (including the decision to call a patient “new” vs. “established”) or should Medicare’s own list of 2-digit specialty codes be used for this purpose? This article provides the answer to that question.
CMS’ website has this brief description of the NUCC taxonomy codes:
The Healthcare Provider Taxonomy codes are a HIPAA standard code set named in the implementation specifications for some of the ASC X12 standard HIPAA transactions…If the Taxonomy code is required in order to properly pay or process a claim/encounter information transaction, it is required to be reported. Thus, reporting of the Healthcare Provider Taxonomy Code varies from one health plan to another.
Even though the most specific level of the 10-digit taxonomy code does indicate a provider’s area of specialty/practice/expertise, this “specialty” information located in the taxonomy code is not what is used by Medicare for claims processing purposes. This is mentioned in the below quote from one Medicare Administrative Contractor (WPS, on p. 19 of this document):
?Medicare, as a payer, does not use the taxonomy code for pricing a provider's services. Medicare uses the provider information based on provider number, locality and specialty [the specialty code in Medicare’s database] to price appropriately (e.g. how they enrolled with Medicare and how their specialty information is maintained in our internal system).
Medicare has made statements to some organizations that the taxonomy code is useful in the NPI application process to distinguish one provider from another with the same name. For example, the American Psychological Association says (on p. 7 of their website here) that they were assured by CMS reps that they “included the taxonomy codes in the NPI process to help distinguish among health professionals, not for use by insurers in governing reimbursement.”
For confirmation that Medicare uses its own “specialty code” listing when it comes to all claims processing functions, we only need to reference the location in Medicare’s manuals that contains this listing (Ch. 26, Section 10.8 of its Internet-only Claims Processing Manual, seen on pp. 75-79 here).
It makes it clear that, as far as Medicare is concerned, the 2-digit Medicare specialty codes “describe the specific/unique types of medicine that physicians and non-physician practitioners (and certain other suppliers) practice.” It then says in a matter-of-fact way that these 2-digit Medicare specialty codes “are used by CMS for programmatic and claims processing purposes.”
When applying the guidance given in Ch. 12 of the same manual, where it says…
30.6.5 - Physicians in Group Practice
(Rev. 1, 10-01-03)
Physicians in the same group practice who are in the same specialty must bill and be paid as though they were a single physician. If more than one evaluation and management (face-to-face) service is provided on the same day to the same patient by the same physician or more than one physician in the same specialty in the same group, only one evaluation and management service may be reported unless the evaluation and management services are for unrelated problems. Instead of billing separately, the physicians should select a level of service representative of the combined visits and submit the appropriate code for that level.
…and…
30.6.7 - Payment for Office or Other Outpatient Evaluation and Management (E/M) Visits (Codes 99201 - 99215)
(Rev. 731, Issued: 10-28-05, Effective: 01-01-04 Chemotherapy and Non-Chemotherapy drug infusion codes/01-01-05 Therapeutic and Diagnostic injection codes, Implementation: 01-03-06)
A Definition of New Patient for Selection of E/M Visit Code
Interpret the phrase “new patient” to mean a patient who has not received any professional services, i.e., E/M service or other face-to-face service (e.g., surgical procedure) from the physician or physician group practice (same physician specialty) within the previous 3 years.
…we must read “specialty” to mean specialty as determined by the 2-digit Medicare specialty code self-assigned by the physician during the Medicare enrollment process, in accord with the direction in Chapter 26 saying that Medicare uses the 2-digit specialty codes to identify the type of medicine a provider practices for claims processing purposes.
Medicare’s specialty code listing does not cover all taxonomies listed on the NUCC’s list, which results in certain providers having different taxonomy numbers still being lumped into a common 2-digit Medicare specialty code for claims processing purposes. One of the reasons that Medicare may not have created a separate 2-digit code for each taxonomy is that there may not be “evidence that the practice pattern of the specialty is markedly different from that of the dominant parent specialty,” despite the fact that both may have been assigned separate taxonomy numbers. Requests can be made to expand the list, but certain conditions must be met, such as producing the evidence just mentioned, in addition to there already being a separate taxonomy number assigned.
So according to Medicare, the taxonomy codes are used as a HIPAA-accepted code set necessary for compliance with HIPAA standards regarding electronic claims submissions and acquisition of NPI numbers, but not used to identify a provider’s specialty for claims processing purposes. For all claims processing purposes, Medicare’s own 2-digit “specialty code” is used to identify a provider as a certain type of specialist and differentiate him/her from other specialists, and it is quite common that multiple taxonomies are grouped into a common “parent” specialty code until such time that Medicare receives an application convincing it to recognize something as a distinct “specialty” for claims processing purposes.
Just because two physicians, having separate taxonomy numbers, are lumped into a common specialty, does not always mean that they can not both bill E/M visits in a single day. True—the “normal” policy for multiple physicians in what is considered to be one specialty is to add their visits together for a single date of service—but Medicare makes a provision for both to be billed separately. This is discussed in its “Concurrent Care” section of its Internet-Only Benefit Policy Manual (Chapter 15, Section 30 E. on pp. 14-15 here), where it says:
…the need for [concurrent] care by physicians in the same specialty or subspecialty (e.g., two internists or two cardiologists) would occur infrequently since in most cases both physicians would possess the skills and knowledge necessary to treat the patient. However, circumstances could arise which would necessitate such care. For example, a patient may require the services of two physicians in the same specialty or sub-specialty when one physician has further limited his or her practice to some unusual aspect of that specialty, e.g., tropical medicine.
The fact that each physician member of what is considered a common specialty (according to Medicare’s 2-digit classification system) possesses a unique taxonomy number could be used as evidence that the care of each physician was unique, and did not duplicate the care of the other.
Lastly, I am often puzzled by the fact that physicians want to be identified as a separate specialty so that they can code more patients as “new” to them. This actually puts them at a reimbursement disadvantage. For example, a patient is seen by a provider who performs a Problem-focused History, a Detailed Exam, and Moderate-level Medical Decision Making. If coding this as an “established” patient visit, they would assign code 99214 (worth about $100). If they had to call this patient “new” and code from that series, they would have to assign code 99201 (worth about $40), since the “new” codes stipulate that the lowest component determines your final level (as opposed to the established codes which allow you to drop the lowest component score).
Seth Canterbury, CPC, ACS-EM
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