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Credentialing is the process of verifying that a healthcare provider meets specific qualifications and standards required by insurance companies and regulatory bodies. This process validates a provider’s education, training, experience, and licensing.
Collecting Information: The healthcare provider must complete a credentialing application that collects detailed personal and professional information. This includes education, medical school or residency, licensure, certifications, work history, malpractice insurance, and any disciplinary history.
Providers may also need to provide proof of their National Provider Identifier (NPI).
Primary Source Verification (PSV): The information provided by the healthcare professional is verified with original sources. This involves confirming degrees, licenses, board certifications, and any previous employment or references. PSV helps maintain high standards and ensures accuracy.
Background Checks: This stage typically involves checking criminal records, malpractice history, and any regulatory or state sanctions to confirm a provider's standing.
Review by a Committee: An internal credentialing committee from the insurance payer or healthcare network reviews the documentation. This review ensures compliance with payer requirements, state regulations, and any other relevant criteria.
Approval and Credentialing Cycle: Once approved, the provider becomes part of the insurance payer’s network and is eligible for reimbursement for services rendered to covered patients. Recredentialing is often required every few years to maintain this status.
Contracting is the process through which a healthcare provider enters into an agreement with insurance companies to become an in-network provider. This agreement outlines terms for service reimbursement, rates, and other obligations.
Offer of Contract: Once credentialing is complete, the payer may offer a contract to the provider. This typically includes the terms of participation, reimbursement rates, and any specific obligations related to the provider’s services.
Negotiation: Providers or their representatives (e.g., practice managers, billing specialists) may negotiate terms related to reimbursement rates, payment timelines, covered services, etc. Negotiation ensures the terms are mutually beneficial.
Contract Signing: After agreement on terms, both parties sign the contract. The provider is then considered “in-network,” meaning they can offer services to patients covered by the insurance company’s plans and receive reimbursement as per the agreed terms.
Onboarding and Training: The insurance payer may offer onboarding or training resources to help the provider and their staff understand policies, claims submission guidelines, and other procedures.
Maintenance: Regular updates to terms and periodic audits may be performed by the payer to ensure compliance with the contract. Providers must also stay up-to-date with any payer or regulatory changes to continue fulfilling contract terms.
Importance of Credentialing and Contracting
Credentialing ensures that healthcare providers meet required standards, contributing to patient safety and care quality.
Contracting defines the terms of service delivery and reimbursement, making it clear how and when a provider is paid for services rendered to insured patients.
Together, credentialing and contracting streamline the process of billing and payments, ensure accurate compensation for services, and enhance patient access to quality care within provider networks.