Medicaid is denying a claim crossed over from Medicare stating it is missing the provider's taxonomy number. The claim included the taxonomy number so why was it removed when the claim crossed over to Medicaid?

Answer: Medicare does not require a taxonomy code to process a claim; however, we will verify that the taxonomy code is valid by comparing it with the latest National Uniform Claim Committee (NUCC) Healthcare Provider Taxonomy Codes (HPTC) code set if it is submitted on the claim. We would include the taxonomy code on any crossover to another insurance company. You may wish to check with your clearinghouse or billing company to ensure they are not stripping the taxonomy number from your claim prior to transmitting to Medicare.

In order for your claim to process with the taxonomy number, it must be in the correct position on your electronic claim. Placement of the taxonomy number depends on if the provider is an option code one or three billing provider.

Option Code 1 (group practice, individual provider is an Option Code 4)

  • The taxonomy number goes at the rendering provider level
  • Loop 2310B, Segment PRV, Element 01=PE, Element 02=PXC, and Element 03=taxonomy #

Option Code 3 (provider is in a solo practice)

  • The taxonomy number goes at the billing provider level
  • Loop 2000A, Segment PRV, Element 02=BI, Element 02=PXC, and Element 03=taxonomy #

If the taxonomy is submitted in any other position it will be rejected before it comes into our claims processing system (referred to as a front-end rejection). It is equally important that the taxonomy code billed matches the primary type and specialty on your Medicare enrollment record, as well as the enrollment records of other payers. Failure to do so may result in claim denials.

Resource: Change Request 8211 (PDF, 88 KB) and article "Health Care Provider Taxonomy Codes (HPTC) Information."

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