What is Credentialing in Healthcare? A Simplified Roadmap for Today's Medical Practices

In the dynamic world of healthcare, ensuring that practitioners are qualified, competent, and capable of delivering the best possible care is absolutely essential. We're going to share what is credentialing in healthcare and how this helps uphold a standard within the industry.

To find high quality healthcare, patients use a variety of methods to determine who would be a good fit for their health needs.

Over 60% of patients search online for their potential providers before booking an appointment, and patients who booked healthcare appointments typically run 3 times more searches than those who don’t book.

Healthcare consumer searches from Invoca.com

The key to what potential patients are searching for when finding a new provider is trust.

One key process that underlies this assurance of trust is credentialing. But what exactly is credentialing in healthcare? Why is it so important, and how does it fit into the larger landscape of a medical practice?

NCDS Medical Billing details the ins and outs of credentialing in healthcare from our decades of experience with the topic below.

What is Credentialing in Healthcare?

The purpose of credentialing in healthcare is to keep standards of quality intact for those receiving care.

Medical credentialing is a process in which health regulators confirm whether healthcare centers are in compliance with industry rules and regulations. Throughout the healthcare credentialing process, practitioners’ qualifications are verified.

The process of credentialing verifies crucial information about healthcare providers such as:

• Medical licenses
• Education
• Experience
• Training
• Residency
• Certificates

Another key aspect of understanding credentialing is working with insurance companies. Credentialing involves communicating with insurance companies to confirm that medical providers can accept third-party reimbursements. Credential verification specialists work closely with both healthcare professionals and insurance companies throughout the credential process.

Overall, credentialing is a key method for providers to boost credibility in the healthcare industry.

Provider Credentialing Video

Why is Credentialing in Healthcare Important?

Credentialing confirms that healthcare professionals have the experience, training, and qualifications that they are required to have to provide care to patients. This process is also essential to ensuring that the medical profession keeps high standards of safety and protects those seeking healthcare.

Healthcare credentialing is taken very seriously. According to the American Hospital Association, healthcare organizations need to comply with 629 regulatory agencies to keep providers properly licensed.

Necessary for Provider Compensation

Without credentialing in healthcare, healthcare providers often cannot be reimbursed for services provided by insurers such as Medicaid and Medicare. Medical credentials are required for reimbursement from many private insurance providers as well.

These credentialing compliance checks are for a good reason: Medicare has uncovered $26 million in erroneous payments tied to expired or fake provider credentials.

When hiring new medical staff, ensuring that all documentation is provided allows them to start working and providing services on their first day. In fact, many healthcare organizations mandate applicants to provide credential documentation ahead of time. Depending on state regulations and laws, the time frame for this requirement can be different.

Creates a Professional Image

Showing a professional image for your healthcare practice by providing credentials validates your practice’s ability to provide quality care for patients. By providing inarguable documentation, your ability to practice in a professional manner is confirmed.

While providing all the paperwork necessary for credentialing can be a hassle that not all providers may want to embark on, modern digitization allows these processes to go much quicker - and the time spent on credentialing is well worth the effort.

Builds Trust and Credibility with Patients

68% of patients say their trust in healthcare has declined in the past two years. Patients’ emotional states and trust in their providers make a major impact on the healing process, and finding ways to create credibility with patients goes a long way.

Additionally, patients that are confident in their doctors’ abilities are more likely to remain patients with that practice and won’t have concerns about their physician's competence.

On the medical provider side, having a medical staff that’s fully credentialed is also valuable for attracting future employees to your practice. Well-trained staff will want to work among others who have a host of credentials and capabilities.

Decreases Medical Errors

Proper medical credentialing helps provide safety and security throughout the entirety of the healthcare industry.

By completing medical credentialing, providers prove that they have the proper experience and training to advise and serve patients. Providers that show their credentials help ensure the safety of patients seeking healthcare.

What are Different Types of Healthcare Credentialing?

In the healthcare industry, there are different categories within the space that fall under the umbrella of credentialing.

Within credentialing in healthcare, the different categories include insurance credentialing, medical sales representative credentialing, and paperless credentialing.

Insurance Credentialing

Healthcare credentialing for insurance refers to when a health insurance company confirms a physician’s credentials.

For insurance credentialing, health insurers check the credentials of a provider before determining them as an “in-network” provider to confirm that the provider is a good option for those in their insurance plan.

Medical Sales Representative Credentialing

Credentialing for medical sales representatives are checks conducted on those who sell medicine, healthcare, or other related services. This type of credentialing confirms and monitors the background and training completed by those who are selling services in healthcare. The intention is to remove bad actors and keep patients safe.

Paperless Credentialing

Paperless credentialing has to do with the software that speeds up the process of credentialing. The intention of paperless credentialing is to reduce or even eliminate physical paperwork.

What is the Healthcare Credentialing Process?

When conducting healthcare credentialing for those in your practice, the typical process is confirming and verifying proof that practicing healthcare providers are legally able to do so.

Verifying this information includes vast documentation to confirm the qualifications, education, and training of your providers.

There are three typical phases in the credentialing process:

1. Credentialing
2. Privileging
3. Enrollment

Credentialing

In the credentialing stage, this is where all the information about a provider is gathered and verified.

This information includes information that includes but is not limited to:

• Name
• Birth date
• Demographic information
• Immunization records
• Recent photograph
• Resume
• Medical school record
• Certificates
• Board certification
• Licensing / Specialties
• Peer references
• Professional liability insurance
• Malpractice claims history
• Sanctions

The necessary information is gathered about the medical practitioner. This information is used across several cross-checks to verify that all is accurate and sound.

Once everything has been confirmed, the credential signals that the healthcare provider has all the needed abilities to perform in their medical role.

Credentials that are awarded to show this verification can include:

• Identification cards
• Certificates
• Official letters

Privileging

Privileging refers to permissions that have been provided based on the confirmed credentials for a medical practitioner to act on services at a healthcare facility.

When credentials are provided and confirmed, certain privileges are given to the credentialed provider. As a result of the evaluation of the provider’s background and abilities, the provider is then authorized to act on a set of clearly defined patient care services.

This set of patient care services is typically called “privileges”.

Granted privileges depend on certain factors that include:

• Facility equipment
• Qualified staff
• Financial resources

Enrollment

After going through the credentialing and privileging processes, a medical practitioner can enroll for payment and bill for their services.

A large part of enrollment is working with insurance companies to become an in-network provider, as mentioned previously.

How Long Does Credentialing in Healthcare Take?

With the amount of documentation and parties to cross-reference information with, credentialing can be a long and tedious process.

Credentialing can often take anywhere from 60-180 days to complete - and sometimes more if necessary.

What are Common Credentialing Errors?

Each year, healthcare organizations spend around $39 billion on administrative tasks related to regulatory compliance. Despite this significant spending, 54% of medical practices shared that denials related to credentialing have increased since 2021.

MGMA Stat Credentialing Data

With the massive amount of information collected and managed from varying sources, mistakes occur easily throughout the credentialing process and errors are common.

Below are the most common errors, and watching out for these common situations can save your practice both time and money.

Missing Primary Source Verifications

Through the sheer amount of documentation needed, providers may struggle to access or locate some of their necessary files. To beat time pressures and get all their documentation in on time, some providers will miss certain primary source documentation or attempt to use secondary sources.

Secondary source verifications lead to delays and denials and also may be inaccurate. Primary source verifications are vital and will lead to an overall smoother process.

Outdated Information About Providers

Documentation that's outdated about providers can bring the entire process to a stop. If there is even just one item that is outdated, the process of healthcare credentialing can completely pause. Ensuring that all information is up to date can help get the credentialing process right the first time.

How to Make the Most of Credentialing in Healthcare

There are a few ways to maximize credentialing in the healthcare process for your healthcare practice. The process can be much easier when it’s fully understood and used to your practice’s benefit.

Understand State Laws

Across the US, states have differing requirements for credentials, timelines, credential transfers, and telemedicine requirements to name just a few complexities. There are varying regulations, laws, and needs to be compliant with each state’s rules for credentialing.

Having a strong understanding of these laws will help get your full medical team credentialed successfully.

Partner with a Healthcare Credentialing Expert

There are many challenges throughout the credentialing process, and credentialing affects the overall revenue cycle process. 61% of providers plan to outsource revenue cycle management tasks to better optimize their revenue cycle and leave it to the experts.

Credentialing is no different. To better attract new providers, new patients, and receive payments for services, ensuring your medical practitioners are properly credentialed is imperative.

A good partner can take the complex, comprehensive, time-consuming work of credentialing off your plate. Contact NCDS Medical Billing to learn more about how to make the most of credentialing to improve your revenue cycle!

Questions?