NPI 1 vs. NPI 2: Understanding the Differences (and How Credex Can Help)
As a healthcare provider or a medical professional intending to open up a new practice, chances are you have come across the terms NPI 1 and NPI 2. These unique identifiers play a crucial role in medical billing and credentialing. Yet, many providers struggle with understanding when to use either one of them. In this guide, we’ll outline some key differences between Individual NPI (Individual) and Organizational NPI (Organizational) for your NPI registration. We will also discuss our professional credentialing and enrollment services that can assist you in registering the appropriate NPI number(s).
What is an NPI registration(National Provider Identifier)
Before diving deeper into their differences, let’s first define what an NPI (National Provider Identifier) is. An NPI is a 10-digit identification number issued by the Centers for Medicare & Medicaid Services (CMS). It is used by healthcare providers and organizations to conduct all HIPAA-compliant transactions, such as insurance claims.
There are two different types of NPI registration.
NPI 1 (Type 1 NPI) – Individual providers
NPI 2 (Type 2 NPI) – Healthcare organizations and group practices
Each type serves its own specific function. Selecting the incorrect type can result in claim rejections, enrollment delays, and compliance issues.
Who Should Get an NPI 1 (Type 1 NPI)?
A person requires an NPI 1 (Type 1 NPI) when:
- You are an individual healthcare provider who bills under your Social Security Number (SSN).
- You are an independent solo practitioner without an organizational structure, such as an LLC, PLLC, or corporation.
- Your business structure does not allow for additional providers.
- You are an independent contractor or employer needing NPI credentials for insurance credentials. An NPI number will help you in processing your insurance credentialing.
Providers Who Require an NPI 1:
- Physicians (MD and DO), Nurse Practitioners (NP), Physician Assistants (PA), and Licensed Professional Counselors (LPC)
- Physical Therapists (PT) and Occupational Therapists (OT)
- Speech-Language Pathologists (SLPs)
Even if you later decide to open a group practice or form an LLC, your NPI 1 will remain permanently tied to you as an individual provider.
Who Needs an NPI 2 (Type 2 NPI)?
An NPI 2 is needed if any of the following apply:
- Your business employs multiple healthcare providers.
- You are assumed to operate as a corporation, LLC, PLLC, or other legal entity and file taxes under an Employer Identification Number (EIN).
- You plan to submit claims under your business name rather than your personal identity.
- Your organization would prefer that payments made for insurance be sent directly to them instead of you personally.
Example Organizations Requiring an NPI 2:
Group medical practices that range from mental health clinics and physical therapy clinics to home healthcare agencies. They also include telehealth companies, urgent care centers, and chiropractic offices with multiple providers.
Type 2 NPIs allow businesses to collect payments and manage provider enrollments without associating everything with one specific individual’s personal information.
Can a Provider Hold Both NPI 1 and NPI 2 Credentials?
These conditions permit healthcare professionals to have both NPI 1 and NPI 2 numbers:
- If you own and manage a medical or therapy practice that requires an NPI 2 yet also sees patients directly, an individual provider registration (NPI 1) will still be necessary.
- Your NPI 1 relates to the individual services you offer. Meanwhile, NPI 2 represents any organization that employs other providers or bills under its own corporate name.
- Insurance companies require both NPIs for group practices. One for the business itself and another for each provider working within its confines.
Example:
A nurse practitioner who runs their practice through an LLC while also seeing patients will require both an NPI 1 (for themselves as individual practitioners) and 2 (for their LLC).
An NPI 2 will be necessary when running a multi-location practice. However, providers may still use NPI 1 when treating patients individually.
How Our Credentialing & Enrollment Services Can Assist in Securing an NPI 1 or NPI 2?
Navigating the NPI application and credentialing process can be time-consuming and burdensome. This is why our expert team offers complete registration, credentialing, and insurance enrollment services to ensure your practice runs efficiently from day one.
How Can We Help with NPI 1 and NPI 2 Registration?
- Choose the Correct NPI Type – We review your business structure and billing needs to help identify which NPI best meets them.
- Submit and Process Your NPI Application – Our team manages the application process to avoid mistakes or delays.
- Change Your NPI Information – Looking to change your business address, ownership details, or EIN? No worries; we specialize in updating NPI details, too!
- Enroll You with Insurance Providers – Our enrollment services ensure that your NPIs are correctly connected with payers like Medicare, Medicaid, and commercial insurers.
- Avoid Costly Mistakes – Many providers are denied insurance credentials due to errors in NPI registration, which we work hard to prevent at the outset.
Let us handle the paperwork so you can focus on patient care!
Final Thoughts: Ensure your NPI registration Is Set Up Correctly
Regardless of whether you are an independent healthcare practitioner, group practice owner, or a provider establishing a healthcare practice, having the correct NPI is key for billing insurance claims and credentialing purposes.
- As an independent provider, you know which document must be filed by using NPI 1.
- If your business employs multiple providers, an NPI 2 may be necessary.
- Many healthcare professionals need both for different billing purposes.
Don’t waste your time with confusing applications or credentialing errors! Contact us now, and let us handle the registration and enrollment of NPI and insurance plans smoothly!
Call us at (833) 477-1261
Email us at info@credexhealthcare.com
Visit Credex Healthcare to Get Started!
FAQs
Can I apply for both NPI 1 and 2 at once?
You can submit both applications concurrently if they will help your practice setup.
Do I require an NPI 2 as a sole proprietor?
No. Sole proprietors typically only require an NPI 1, unless you will form an LLC or corporation.
How long will it take for me to receive an NPI?
Most NPIs are issued within two or three business days.
Can I change my NPI type later?
No. However, your business structure could apply for an NPI 2 application if the need arises.
Let us handle your NPI and credentialing needs so you can focus on expanding your practice!
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As a Homecare agency, navigating credentialing and enrollment can be a headache, but Credex Healthcare made it simple and straightforward. They took care of everything from our NPI management to PECOS enrollment, ensuring compliance at every step. Their expertise in primary source verification and network research helped us expand our network, allowing us to provide care to more patients. Highly recommend!
Homecare Agency Owner
Credex Healthcare has been an invaluable partner for our multi-specialty group practice. They handled all our credentialing and enrollment needs, ensuring every provider was up-to-date across insurance networks and credentialing portals like CAQH and PECOS. Their ability to track and manage multiple providers’ licenses and certifications has saved us a tremendous amount of time and reduced our administrative burden.
Pediatric Group
Running a lab comes with its own set of compliance challenges, but Credex Healthcare has taken care of it all. They managed our CLIA waiver, credentialing, and enrollment processes, ensuring that we met every regulatory requirement. Their attention to detail and ability to handle complex credentialing issues has allowed us to focus on our operations without worrying about missing deadlines or facing compliance issues. Exceptional service!
Lab Director
Credex Healthcare has been a game-changer for our HomeHealth agency. They managed our credentialing process from start to finish, ensuring all our licenses, DEA registrations, and CAQH profiles were up to date. Their expiration tracking system is incredibly helpful in keeping everything in check. Thanks to them, we can focus on delivering quality care to our patients without worrying about administrative hurdles.
HomeHealth agency Owner
Credex Healthcare has been amazing to work with. As a Nurse Practitioner, they took care of everything, from managing my NPI and PECOS enrollment to handling all my licensing and revalidation requirements. Their support has allowed me to concentrate fully on patient care, and their thorough primary source verification ensured that my credentials were always accurate and up to date. I couldn’t ask for a better partner!
Nurse Practitioner (NP)
I’ve had an outstanding experience with Credex Healthcare. They took over my credentialing, managed my CAQH profile, and handled my DEA registration with ease. Their team made sure my practice stayed compliant and helped me with network research and application follow-up. I don’t know what I would do without them handling all the administrative tasks!
