How Credentialing Can Improve Revenue Cycle Management: A Comprehensive Guide

James Smith
02 May, 2023 updated

Your team pours its heart into delivering top-notch medical care, where cutting corners just isn't in the playbook. The rigorous journey of medical credentialing underscores this commitment, guaranteeing patients can trust in the care they receive. Yet, let's face it, the admin load is hefty, swaying your team's focus from patient care to piles of paperwork. Yes, it's a drag and eats up precious time.


We all agree, our healthcare heroes need to be top of their game. Their expertise not only uplifts the health of our communities but also trims down costs for insurers and big players like Medicaid and Medicare. Whether it's the dedicated nurse practitioner or the ace surgeon, the value of solid credentialing shines through. The catch? The admin grind can bog down your team, putting a pause on patient care as they wade through forms.

What is provider credentialing?

Credentialing lays the foundation for a healthcare organization's ability to offer clinical privileges to its providers. It's a thorough procedure that not only hospitals but also healthcare organizations at large engage in. This process ensures that both employed and affiliated practitioners, such as a local physician seeking to join a hospital's medical staff, meet the stringent standards required to practice medicine.

But it's not just healthcare organizations that are invested in this process. Insurance companies, both private and government-run, play a significant role in credentialing as well. They might take on this task alone or work alongside healthcare institutions, often turning to specialized credentialing verification organizations (CVOs) to get the job done.

This multi-layered process is vital for maintaining the integrity of healthcare services, ensuring that every professional within a hospital's walls is thoroughly vetted and ready to provide the highest level of care.

How does provider credentialing work?

The journey of provider credentialing unfolds in distinct phases, orchestrated by a dedicated team within an organization’s credentialing department or by a specialized Credentialing Verification Organization (CVO), whether in-house or outsourced. This team embarks on a meticulous mission to:

  1. Collect a comprehensive array of information directly from the provider, a task that frequently necessitates diligent follow-up for completeness.
  2. Conduct primary source verification (PSV) to confirm the authenticity and accuracy of the gathered data and documents.
  3. Scrutinize the information to pinpoint any inconsistencies, gaps, or warning signs that could raise concerns.
  4. Formulate recommendations on credentialing outcomes, determining whether a provider should be enrolled with payers or granted clinical privileges within the healthcare facility.

This process begins with the thorough collection of a provider's professional credentials, including all requisite documentation and certifications. This step is crucial for establishing a provider’s qualifications and compliance with standards set by regulatory and accrediting agencies such as the Centers for Medicare & Medicaid Services, state healthcare oversight bodies, The Joint Commission (TJC), The National Committee for Quality Assurance (NCQA), DNV GL Healthcare, the National Association for Healthcare Quality (NAHQ), the Utilization Review Accreditation Commission (URAC), among others.

Why does medical credentialing matter?

Medical credentialing sets the bar for excellence in our healthcare system. It's the backbone ensuring that every American can place their trust in healthcare providers, confident that their well-being is in capable hands, regardless of their treatment location. This vital process meticulously verifies each medical professional's credentials to maintain or exceed the foundational standards of healthcare provision.

However, cutting corners or overlooking the rigor of the credentialing process can lead to severe repercussions for healthcare organizations:

  • Safety Concerns: A lapse in credentialing could mean patients are at risk of being treated by providers who lack the necessary qualifications, potentially compromising patient care.
  • Legal Implications: Failing to properly credential can expose healthcare providers to lawsuits over malpractice or negligence and could even result in penalties against their medical licenses.
  • Financial Ramifications: Credentialing directly affects the ability to be enrolled with health insurance companies. Discrepancies in a professional's credentials can cause denial of reimbursement claims. Given that many healthcare providers rely heavily on these reimbursements, any mistake in credentialing could lead to significant financial losses.
  • Reputation Damage: Any negative publicity regarding a lapse in a provider's credentials can quickly undermine patient trust, making them think twice about seeking care from that provider or institution.
  • Accreditation Risks: Accreditation agencies closely monitor the credentialing processes of healthcare institutions. Any oversight or error can threaten an institution's accreditation status, impacting its credibility and operational legitimacy.

Primary source verification

Checking directly with the original source for a healthcare provider's credentials is crucial to eliminate inaccuracies or even false claims. Here's what typically happens during PSV:

  • The provider's ID, criminal background, and status with the Office of Inspector General are verified.
  • Applications and requests for privileges are thoroughly reviewed.
  • Education, training, and certification details are confirmed right from the source.
  • State licenses, DEA registrations, and proof of liability coverage are checked.
  • A query to the National Practitioner Data Bank is made to uncover any history of malpractice.
  • Work history is confirmed, and references from directors or department chairs are collected.
  • Compliance with standards from the NCQA, The Joint Commission (TJC), or URAC is verified.
  • Each state’s specific verification requirements are followed meticulously.

The goal of gathering all this info is to paint a complete picture of a provider's fitness—clinically, personally, and professionally—to work within a healthcare organization. The credentialing team meticulously reviews every piece of data to ensure nothing is amiss.

While those responsible for credentialing don't usually make the final call, they do lay out all the facts for the decision-makers. Any slip-ups in these steps can lead to delays, denials, or worse, risking patient safety and the organization's financial health.

Who’s responsible for credentialing?

Credentialing is a team effort, involving both healthcare organizations and insurance payers, though each has its unique approach.

Hospitals and healthcare systems kick off credentialing by collecting data that's crucial for defining what clinical procedures providers are allowed to perform and for including them in insurance panels. This ensures the organization gets paid for the services rendered.

On the flip side, insurance companies, whether they're big names like Cigna, Humana, and UnitedHealth, or government entities like the Centers for Medicare & Medicaid Services, use credentialing to manage their network of providers. Their goal is to control healthcare costs while making sure members get the promised benefits.

Providers aren't just passive participants in this process. Before they can join a hospital or healthcare system, they've got a checklist to complete:

  • Finish their basic medical training for whatever role they're eyeing.
  • Go through any specialized training or fellowships to hone the skills necessary for their specialty.
  • Get licensed in their state or by a specific professional body.
  • Officially apply to the healthcare organizations where they want to work or be affiliated.
  • Many organizations then shift the responsibility onto the provider to gather and submit all the necessary documents for credentialing on time.

This collaborative approach ensures that every provider joining a healthcare system or network meets the high standards required to deliver quality care, ultimately benefiting patients and the entire healthcare ecosystem.

Common pitfalls in the credentialing process

Navigating credentialing starts with the application itself, where missing pieces or mistakes can throw a wrench in the works, causing delays that ripple through the entire process. Keeping records up to date is another critical step; letting licenses or certifications collect dust in a drawer, or failing to digitize the latest achievements, can lead to a tangle of confusion and lost time down the line.

Then there's the temptation to stick with the old ways, manually checking and verifying every detail. While this might feel reassuring, it's a slow path filled with opportunities for error, a reminder that sometimes, tradition doesn't trump technology. And in a field that's always evolving, losing track of the latest regulatory changes isn't just an oversight; it's a fast track to falling out of compliance.

Best practices for effective provider credentialing

By sticking to a clear-cut process, embracing the latest tech, and leveraging delegated credentialing, medical facilities can streamline the whole shebang, making sure they stay laser-focused on delivering top-notch patient care.

Here's the rundown:

  • Kicking Things Off with the Initial Application: Providers dive in by completing an in-depth application that covers their educational background, training, professional journey, and any specific skills they bring to the table.
  • Gathering the Goods Documents: Next up, providers need to hand over a bunch of paperwork – think diplomas, licenses, certifications, and malpractice insurance proof.
  • Digging into Primary Source Verification: This crucial step involves double-checking all those documents straight from the source – like verifying a med school diploma directly with the med school.
  • Rounding Up Peer References: Providers also need to line up some references from colleagues who can vouch for their skills and professionalism.
  • Committee: The credentialing squad then sifts through all this info to decide if a provider is up to snuff and ready to join the ranks.
  • Keeping Tabs: It doesn’t stop there – it’s vital to continually monitor and refresh providers’ creds to ensure they’re always up to par.

With the right mix of tools and strategies, credentialing can be a breeze, paving the way for expanding networks without the headache.

Has provider credentialing changed?

Absolutely. While the core rules set by regulations and accreditation bodies remain stable, the digital revolution is transforming how the game is played:

Integration of Credentialing and Payer Enrollment: Enrollment has become as crucial as medical services themselves, driven by a host of factors: more healthcare providers are becoming employees, the healthcare industry is consolidating, and there's a push to maximize reimbursements under value-based care.

The Move to Paperless Processes: The days of paper-based systems are numbered. Digital solutions not only offer more secure exchanges but also simplify the sharing and storage of information. Environmental and spatial benefits are pushing healthcare towards digital data management systems, making credentialing smoother and more accessible.

Cloud Technology Empowers Remote Work: The future is remote, and cloud technology is making it possible for credentialing tasks to be handled from anywhere, on any device. Tools like Credsy allow for the online submission of credentialing documents, streamlining the process and ensuring data can be easily shared and reused.

Credentialing Data as a Key Resource: The data managed by credentialing professionals is now a goldmine for a wider range of users within healthcare organizations. Governance, risk management, and compliance sectors are leveraging this data, which flows through credentialing, privileging, quality, safety, and enrollment functions, to ensure healthcare delivery is both safe and compliant.

The role of automation in streamlining credentialing

Diving into how automation is reshaping credentialing, it's clear that we're not just moving towards digital—we're leveraging the full force of technology to make the entire process smoother and more efficient. Through the use of APIs and AI, automation is transforming credentialing by enhancing:

  • Accuracy: Automation means every step, from pulling records to completing applications, is precise, ensuring data integrity from start to finish.
  • Speed: What used to take weeks or even months can now be accomplished in days, if not hours.
  • Cost-Effectiveness: By cutting down on manual tasks and the need for extensive overhead, automated systems offer long-term savings, making credentialing financially smarter.
  • Revenue Boost: Quicker credentialing translates to providers being able to see patients—and generate income—much faster.

The bottom line

Credentialing demands meticulous attention to collecting and evaluating a wealth of data points about each healthcare provider. This isn't just about ticking boxes; it's a comprehensive assessment aimed at ensuring every healthcare worker is fully equipped, both in skills and character, to deliver exceptional care. It embodies the commitment of healthcare organizations to maintain the highest standards of safety and quality in patient care. It's a collective effort across various organizational levels, all united in the mission to provide outstanding healthcare services. By adhering to the best practices in credentialing, we ensure that every member of our healthcare community is well-prepared to uphold the excellence in care that patients deserve.

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