Credentialing healthcare providers is essential but often painfully slow, delaying revenue flow and patient care. However, delegated credentialing helps healthcare organizations take control of the credentialing process, reduce waiting times, and improve revenue cycle management (RCM).
Instead of relying solely on payors to verify providers, delegated credentialing allows health systems to handle the process internally or through trusted partners, accelerating approvals and reducing redundancy.
As speed to patient care and timely reimbursements are crucial, understanding and leveraging delegated credentialing can be a key differentiator.
This blog will break down what delegated credentialing is, how it works, and why it’s becoming essential for healthcare organizations looking to enhance efficiency and revenue performance.
Delegated Credentialing: What It Is and How It Works?
Credentialing by delegation occurs when a specific payor permits an organization, normally a larger health system, to complete the credentialing process independently.
However, simply checking the credentials is not enough. The health system, which takes up the role of the delegated authority, assesses the suitability of healthcare practitioners and makes the credentialing decisions for the payor. Although the health system performs all necessary steps to complete the credentialing process, the payor retains the right to veto any decisions made by the delegated entity.
For delegated credentialing to function, there must be a mutually agreed-upon arrangement outlining the obligations of each party, ensuring compliance with regulatory bodies such as the NCQA, URAC, and CMS, as well as federal and state laws.
These delegation agreements can be standalone documents or amendments to existing contracts. The entity granted permission to perform credentialing is commonly referred to as the Delegated Entity, Delegate, or Client.
Delegated Credentialing and Regulatory Compliance: What You Need to Know
Several regulatory bodies are involved in or have a vested interest in delegated credentialing:
- The National Committee for Quality Assurance (NCQA): The National Committee for Quality Assurance stands out as the foremost organization promoting accreditation in the health sector. Its primary purpose is improving healthcare delivery systems.
The NCQA shows an evidence-based program for case-management accreditation that all payer, provider, and community-based organizations can use. Due to the importance placed on these standards, particularly in delegated contracts, comprehensive review by relevant entities is essential.
- The Centers for Medicare & Medicaid Services (CMS): The Centers for Medicare and Medicaid Services (CMS) within the Department of Health and Human Services (HHS) supervises programs such as Medicare, Medicaid, Children’s Health Insurance Program (CHIP), and some elements of the Affordable Care Act (ACA).
It is important to note that any organization rendering healthcare services as per these federal programs, especially those wishing to outsource the credentialing process, should be aware that CMS requires more than what the National Committee for Quality Assurance (NCQA) standards call for.
- Local State Governments: In addition to federal and national standards, certain state governments may impose supplementary credentialing process requirements. These potential additions include mandated applications, utilizing a designated organization for primary source verification, and enforcing specific turnaround times for completing the credentialing process.
Ongoing Credentialing Responsibilities Under Delegated Credentialing Agreements
Delegated credentialing can be achieved through two main methods:
- A vital component of the credentialing process that can be delegated is the outsourcing of the process to a Credentials Verification Organization (CVO). These entities are an arm of a healthcare unit's credentialing department but specialize in performing primary source verifications for their clients.
- Another form of delegated credentialing is setting up an internal Credentials Verification Organization CVO. This CVO would take charge of the verification process for every healthcare provider within the institution, regardless of their location. This centralized structure would be responsible for conducting primary source verifications, and streamlining the credentialing process for the organization.
Top Benefits of Delegated Credentialing for Revenue Cycle Management
Leveraging an internal or external CVO to manage and centralize the provider credentialing process offers the following strategic benefits:
- Accelerated Payer Enrollment Timelines:
Pursuing contractual agreements for delegated credentialing allows health plans to expedite the physician enrollment process. Traditionally, a healthcare payer would take 90-120 days to credential a provider; however, using delegated agreements can reduce this time to 30-60 days. This shifts the gears to the quick onboarding of new providers so they can attend to patients and cut costs due to timely reimbursements.
- Medical Staff Efficiency:
Beyond streamlining payer enrollment, delegated credentialing offers substantial benefits for an organization's medical staff. Currently, providers practicing at multiple facilities within the same healthcare system face the redundancy of undergoing credentialing at each location, essentially duplicating the verification effort.
By centralizing the credentialing process through delegation, this burden is lifted from individual providers, allowing them to dedicate more time to crucial tasks such as privilege and board approvals. This improved efficiency translates to a more focused and productive medical staff.
- Provider Availability:
When there is no delegated credentialing, providers working in many healthcare organization facilities face considerable administrative work. Conventionally, each facility requires them to fill in the credentialing verification documents, which means that a lot of time and effort is wasted on a needless repeat of work.
Consolidating the centers' activities by delegating the credentialing process further removes this duplication. It saves precious time for providers that can be utilized in more productive ways, such as attending to patients and other critical activities.
- Effective revenue cycle and reimbursements:
Delegated credentialing offers a clear financial benefit for healthcare organizations by reducing the administrative burden on providers. Delegation frees up valuable provider time by eliminating the need to complete separate credentialing paperwork for each facility.
This translates directly into an increased capacity to see more patients, leading to more patient encounters. This growth in patient interaction directly correlates with increased organizational revenue and ultimately translates to faster reimbursements.
- Increased Patient Satisfaction:
The practice of delegated credentialing contributes to enhancing patients’ satisfaction levels since it assists in moving the process of onboarding new providers. However, this credentialing process can be time-consuming and thus slow down the provider’s ability to see patients.
In a delegated agreement, as opposed to asking each facility to complete individual credentialing tasks, the processes are coordinated and simplified; hence, the time taken for a new provider to get credentialed and start working is reduced.
This translates to shorter wait times for patients seeking appointments, ultimately enhancing their overall satisfaction with the healthcare organization's efficiency.
Conclusion
Delegated credentialing has established itself as a powerful strategy for healthcare organizations seeking to accelerate provider onboarding, enhance revenue cycle management, and improve patient access to care.
By streamlining credentialing, healthcare providers can reduce administrative waste and focus on delivering better outcomes. If you’re ready to explore how delegated credentialing can work for you, let’s talk.
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If you are a healthcare provider and wish to learn more about delegated credentialing, feel free to write to us at partnerships@homrcm.com.
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