For the Week of February 20, 2017

If several pharmacies, each with their own national provider identifier (NPI), are owned by the same covered organization health care provider (payee), may the X12 835 payment and remittance advice for these pharmacies be consolidated and sent to the covered organization health care provider (i.e., the “parent”)?

According to the Centers for Medicare & Medicaid Services (CMS), payment and remittances for multiple pharmacies, each with their own NPIs, may be consolidated when the receiving entity (payee) shares the same taxpayer identification number (TIN) as those pharmacies. The pharmacies are subparts of the payee.

In order for the payment and remittance to be consolidated, states CMS in FAQ2189, “The payee identification at the Header Level must be the NPI of the entity designated to receive the payment.” CMS also notes that “while the consolidation of remittances is technically feasible, this fact does not obligate a payer to execute such consolidation – this is a business decision and contract issue to be negotiated between trading partners.”