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Provider credentialing is pivotal for enhancing financial stability in the complex healthcare management’s complex ecosystem.
While issues like patient volume, billing errors, inconsistent provider data, and shifting state regulations often take center stage, they account for just a fraction of the $60 billion spent on administrative tasks.
This spending, 15% of which is attributed to administrative waste (non-clinical costs that don't enhance patient care), is exacerbated by inefficient provider credentialing — from chasing down providers for information to tracking application statuses. The role of effective provider credentialing in revenue cycle management (RCM) is crucial and cannot be underestimated.
Provider credentialing — a thorough process that verifies a healthcare provider's qualifications and history — not only protects patients but also ensures your medical practice receives payments from commercial payers, Medicare, and Medicaid.
We spoke with Medallion’s Senior Director of Operations, Caitie Barrett, to dive deeper into the role of provider credentialing in RCM. She emphasized the importance of efficient credentialing practices for patient safety and ensuring timely payments for healthcare organizations.
“Credentialing involves multiple steps — from application receipt, review, data verification, committee evaluations, to approvals. Maintaining this data is really tough, so anything you can do to remove time from the process while still being compliant and doing things well is so important,” Caitie explained.
For healthcare establishments, from expansive hospitals to private clinics, a robust RCM is foundational. It covers everything from patient registration to the final payment. Efficient RCM ensures consistent cash flow, which is essential for both operational and clinical functions.
Caitie added, “Credentialing and RCM often operate within different departments in a hospital. So, having accurate data from credentialing is critical to ensure appropriate payments.”
Effective credentialing is a linchpin for financial health in medical practices. As highlighted by MGMA, without a strategic approach to credentialing, practices risk fiscal challenges. This can manifest as disrupted cash flow, potentially affecting staff compensation and the procurement of essential medical supplies.
Credentialing plays a pivotal role in ensuring seamless billing experiences, which directly contribute to patient trust. However, the inverse is also true. As reported by MGMA, over half of medical practices noted an increase in denials related to provider credentialing in 2021. Such issues can dissuade patients from revisiting, even if they received high-quality clinical care.
Any oversight in credentialing diverts resources from primary care. Over time, such misallocations can compromise service quality. A 2021 MGMA poll highlighted that credentialing issues significantly contributed to claim denials, with challenges ranging from prolonged application processing to inconsistent payer communication.
Effective credentialing results in:
Many claim denials stem from provider data inconsistencies. It’s an area where 49% of medical practices are struggling. Efficient credentialing reduces these issues, leading to fewer rejections.
Properly credentialed providers ensure faster claim approvals, stabilizing revenue streams.
Patients feel more confident knowing their healthcare provider meets insurance standards.
Caitie remarked, “The more streamlined the credentialing process, the more time providers can dedicate to patients. Speedy credentialing also reduces claim denials due to delayed approvals.”
Embracing technology-driven credentialing can mitigate many challenges. By doing so, healthcare organizations can avoid delays in provider onboarding, claim corrections, and hefty compliance penalties.
“Transitioning from a generic healthcare approach to a more personalized, demand-driven model is the future,” Caitie noted.
By collaborating with a competent Credentials Verification Organization (CVO) and leveraging modern technology, healthcare organizations can revolutionize the credentialing process. Automation and AI have made the process more efficient than ever.
Choosing a credentials verification organization (CVO) can greatly enhance your credentialing process. When evaluating potential CVOs, consider the following key aspects:
Beyond these primary considerations, go deeper into their offerings and capabilities:
By meticulously evaluating these criteria, you can select a CVO that aligns with your organization's requirements and goals.
Because in the evolving landscape of healthcare management, recognizing the power of effective provider credentialing is undeniable. It transcends mere regulatory compliance — it strengthens the financial and reputational pillars of healthcare institutions. Medallion offers an NCQA-certified CVO solution that enables healthcare organizations to move faster and get ahead — in days, not weeks. With automated verifications and a dynamic platform that optimizes every aspect of your provider credentialing process. Learn more about Medallion CVO services here.