Legislation that led to the creation of the National Practitioner Data Bank (NPDB) was enacted because the U.S. Congress believed the increasing occurrence of medical malpractice litigation and the need to improve the quality of medical care had become a nationwide problem that warranted greater efforts than any individual State could undertake. The intent of the NPDB is to improve the quality of health care by encouraging State licensing boards, hospitals and other health care entities, and professional societies to identify and discipline those who engage in unprofessional behavior and to restrict the ability of incompetent physicians, dentists, and other health care practitioners to move from State to State without disclosure or discovery of previous medical malpractice payment and any adverse action history. Adverse actions can involve licensure, clinical privileges, professional society membership, and exclusions from Medicare and Medicaid.

The NPDB is primarily an alert or flagging system intended to facilitate a comprehensive review of health care practitioners' professional credentials. The information contained in the NPDB is intended to direct discrete inquiry into, and scrutiny of, specific areas of a practitioner's licensure, professional society memberships, medical malpractice payment history, and record of clinical privileges. The information contained in the NPDB should be considered together with other relevant data in evaluating a practitioner's credentials. It is intended to augment, not replace, traditional forms of credential review.