NPI Type 1 vs Type 2: Which Do You Need?
Every NPI is one of two kinds, and the kind decides who it can identify.
Type 1: individuals
A Type 1 NPI belongs to a person — a physician, nurse practitioner, therapist, pharmacist, counselor. Each individual has exactly one, for life. It follows them from job to job and state to state. Sole proprietors also use their Type 1 NPI for their business.
Type 2: organizations
A Type 2 NPI belongs to an organization: a group practice, hospital, pharmacy, home health agency, laboratory, or an incorporated solo practice. An organization can have more than one — a hospital may get separate NPIs for distinct units — and each is tied to the organization, not to the people who work there.
How they meet on a claim
On a professional claim, the billing provider is usually the organization (its Type 2 NPI), and the rendering provider — who actually saw the patient — is the individual (their Type 1 NPI). A solo practitioner who has incorporated needs both: the Type 2 for the corporation as the billing provider, and their own Type 1 as the rendering provider.
Taxonomy codes follow the type
The NUCC code set marks every code as individual or non-individual: 698 codes for people and 185 for organizations. A Type 1 NPI should carry individual codes, a Type 2 NPI organization codes — a group practice uses a group code such as Multi-Specialty Group, not the specialty of its physicians.
The NPI lookup shows the type of any NPI; the taxonomy finder shows which codes are for individuals and which for organizations.
Subparts
Large organizations can obtain separate Type 2 NPIs for subparts — a hospital's psychiatric unit, a rehabilitation unit, or a separately located clinic — when those parts bill separately or need to be identified on their own. Medicare requires separate NPIs for certain subparts, such as units that Medicare certifies on their own. Each subpart NPI carries the taxonomy code for that unit, which is why hospitals often hold several NPIs with different codes.
Questions
Does a solo practitioner need a Type 2 NPI?
Only if the practice is incorporated (for example an LLC or professional corporation) and bills under that entity. A sole proprietor bills under the individual Type 1 NPI.
Can an individual have more than one NPI?
No. An individual provider has one Type 1 NPI for life, whatever their employer, location or specialty.