Did you know that according to the Peter G. Peterson Foundation, in 2023, U.S. healthcare spending reached $4.9 trillion? Healthcare spending has continued to increase as medical care costs continue to rise.
Since healthcare organizations face financial pressures, streamlined revenue cycle management is now crucial. Therefore, billing professionals must understand the processes that support timely reimbursement and regulatory compliance.
Billing staff often deal with terms such as enrollment, credentialing, or privileging, and sometimes use them interchangeably. Does that mean each term refers to the same thing? Unfortunately no.
Understanding Enrollment, Credentialing, and Privileging
Enrollment, credentialing, and privileging are distinct steps in the reimbursement process. Although these processes occur before reimbursement, they serve different purposes in provider onboarding, regulatory compliance, and billing readiness.
- Credentialing verifies the qualifications of a practitioner.
- Privileging allows practitioners to complete specific procedures at the place of service.
- Enrollment allows them to bill payers for the provided services.
Although these terms are somewhat interconnected, confusing them can stall onboarding. It may also harm patient scheduling, slow down reimbursement, and disrupt the revenue cycle.
Key Differences Between Enrollment, Credentialing, and Privileging
Establishing clear differences between enrollment, credentialing, and privileging is a crucial step for clean reimbursement operations. The following table distinguishes the three as follows:
| Category | |||
|---|---|---|---|
| What Is The Primary Purpose? | Registers the service provider with insurance payers to submit and receive reimbursement for claims. | Verifies a provider’s licensure, education, training, certifications, work history, and other professional qualifications. | Permits a provider to perform specific services and clinical procedures within a healthcare facility. |
| Who Is the Responsible Party? | Medicare/Medicaid, Payer enrollment teams, and provider enrollment or medical billing specialists. | Credentialing Verification Organizations (CVOs), health plans, hospitals, and credentialing departments. | Credentialing committees, hospital medical staff offices, and governing boards. |
| What Are the Regulatory Requirements? | Medicare/Medicaid enrollment rules, CMS regulations, and payer enrollment policies. | Joint Commission requirements, NCQA standards, and payer credentialing guidelines. | CMS Conditions of Participation, Joint Commission standards, and facility bylaws. |
| What Impact Does It Have On Billing and Reimbursement? | Allows the provider to bill payers and receive reimbursement for covered services. | Validates that payer requirements are met by the provider for network participation and claim processing. | Ensures the provider only performs services and procedures for which they have clinical privileges. |
| How Does Maintenance and Renewal Work | Requires periodic revalidation or re-enrollment based on CMS and payer requirements. | Requires periodic re-credentialing based on payer, accreditation, or organizational requirements (commonly every 2-3 years). | Privileges are periodically reviewed and renewed, per the healthcare facility’s credentialing and medical staff policies. |
What is Credentialing in Healthcare?
Credentialing in healthcare is a process designed to protect patients by verifying the qualifications of health practitioners. This way, every patient is treated by a competent professional, and the facility is safe from negligence liability.
What is Typically Verified During Credentialing
- State medical license
- DEA/CDS registration (if applicable)
- Board certification
- Work history
- Malpractice history
- National Practitioner Data Bank (NPDB) queries
Credentialing Process in Healthcare
- The provider submits a credentialing application along with the required supporting documentation.
- Relevant bodies conduct primary source verification against training institutions and licensing boards.
- NPDB and sanction database queries are carried out.
- Findings are reviewed, and the review committee may make recommendations.
- Credentialing is approved, and the re-credentialing timeline is also set (generally every two to three years).
What is Privileging in Healthcare?
Credentialing and privileging build directly on one another. Credentialing validates practitioners’ qualifications, and privileging in healthcare authorizes the practitioner’s clinical activities and procedures. The authorization is applicable at the place of service, based on their qualifications.
For instance, consider a cardiothoracic surgeon who may work at a hospital but would require privileges for:
- Open-heart procedures
- Patient admission
- Trainee supervision
Privileging Process in Healthcare
The process begins with relevant bodies defining privilege categories, based on the services offered by the facility. Practitioners must document the number of cases they handle, their outcomes, and peer references for each applicable privilege.
Next, the practitioner’s competency is evaluated through peer review rather than credentials alone. The committee approves, denies, or modifies requested privileges, depending on all the information received.
Lastly, there is an ongoing Professional Practice Evaluation and a Focused Professional Practice Evaluation applicable to practitioners who are under review or new to a privilege.
Hospital privileges are generally facility-specific and may not automatically transfer to another hospital, even within the same health system, unless the organizations have an approved shared credentialing and privileging process.
What is Provider Enrollment in Healthcare?
Enrollment in healthcare (or payer enrollment) is the process through which an individual provider or medical practice enrolls with a payer to receive reimbursement for covered services.
While credentialing and privileging cover authorization for clinical practice, enrollment is used to bill the payer.
If a provider or facility has an inactive enrollment, the submitted reimbursement claim may be denied regardless of the clinical authorization or practitioner qualification.
Enrollment Process in Healthcare
- The practice and provider information, such as Tax ID, NPI, practice locations, and specialty, are submitted.
- Enrollment applications are completed through Medicare PECOS, state Medicaid enrollment systems, and commercial payer enrollment portals. Additionally, multiple commercial payers utilize DataSpring (formerly CAQH ProView) to review provider information during the credentialing and enrollment process.
- Providers are connected to the appropriate group billing entity.
- The enrollment status, payer review, and network effective dates are reviewed.
- Ongoing payer revalidation is managed to maintain active enrollment and participation.
Regulatory Requirements for Credentialing, Privileging, and Enrollments
No standalone federal law covers credentialing and privileging. However, hospitals participating in Medicare and Medicaid must comply with the CMS Conditions of Participation, 42 CFR 482.22.
Under the CMS Conditions of Participation, the governing body and organized medical staff are jointly responsible for the appointment and privileging process in accordance with 482.12 and 482.22. The process must include an assessment of the practitioner’s:
- Individual character
- Competence
- Training
- Clinical experience and judgment
Hospitals accredited by the Joint Commission must comply with its Medical Staff (MS) chapter standards governing credentialing and privileging.
These standards cover credentialing and privileging details such as:
- Verification processes
- Current performance evaluation
- Medical staff bylaws
U.S. court decisions recognizing corporate negligence establish that hospitals are responsible for carefully evaluating and granting clinical privileges to practitioners.
From an enrollment perspective, process requirements depend on the payer but not on accreditation. The PECOS governs Medicare enrollment, which requires periodic revalidation.
Conversely, commercial payers have their dedicated documentation rules and timelines.
However, typically, commercial payers use National Committee for Quality Assurance (NCQA) credentialing as a foundation for network participation.
How Credentialing & Provider Enrollment Delays Impact Revenue?
Enrollment, credentialing, and privileging all play a crucial role in medical billing. However, credentialing and provider enrollment may also get delayed, harming revenue. Here’s how:
- More than half of practices reported an increase in credentialing-related denials in 2021.
- Credentialing and enrollment delays may prevent providers from submitting claims under their own NPI until payer enrollment becomes effective.
- Depending on payer requirements, some services may need to be kept on hold until enrollment is effective. Others may be billable under another provider (payer policy specific).
- Credentialing and enrollment timelines vary for payers, lasting from 45 to 120 days. It depends on the completeness of the application and payer processing times.
- Payer delays can stretch up to 100 days for enrollment, and retroactive claims may be rejected, causing revenue loss.
Key Challenges & Best Practices
Enrollment, credentialing, and privileging can pose serious challenges for practitioners and practices alike. The following is a breakdown of these challenges and the proven methods to avoid them:
Challenges
- Enrollment, credentialing, and privileging have their own dedicated tracking system. These systems make the overall onboarding pipeline more complex.
- Incomplete applications cause enrollment delays, disrupting revenue.
- Each state Medicaid program and commercial payer has its dedicated documentation timelines and standards, complicating the process.
- Practices must track certifications, licenses, and payer revalidation cycles if they wish to continue billing payers without denials.
Best Practices
- Begin the credentialing and enrollment process as early as possible, while ensuring applications are complete before submission.
- Centralize tracking for relevant documentation and revalidation expiration dates.
- Before submitting applications, verify payer panel status. This step prevents practices from submitting applications to closed panels.
- Determine a single accountability point for the full credentialing-to-enrollment pipeline.
- Always submit complete and clean applications on the first attempt. Resubmissions can lead to timeline extensions.
Streamline Enrollment, Credentialing, and Privileging with NeuraBill
Enrollment, credentialing, and privileging each have distinct importance in revenue cycle management. However, they are interconnected, and delays could mean compromised revenue. In-house teams often extend the timeline due to errors such as submitting applications to closed insurance panels, missing out on necessary documentation, or non-adherence to payer-specific requirements.
NeuraBill’s provider credentialing services effectively eliminate those errors. Our team performs a free payer analysis to confirm which insurance panels are open in your area, streamlining the process.
