Credentialing is a crucial step for healthcare providers aiming to open their own practice or transition from a former employer. Misunderstanding the nuances of this process can lead to delays and financial setbacks. This guide highlights three primary areas where confusion often arises and offers practical advice to navigate these challenges effectively.

1. Disassociating from Former Groups or Employers

One of the most significant confusions in credentialing is the need to disassociate yourself from any previous medical group or employer. When you worked for a group, you were likely credentialed under that group’s tax ID number. This means that if you want to start your own practice, you need to disassociate from the former group and start fresh.

Why It’s Important: If you don’t disassociate, insurance payers might still associate your credentials with your former employer. This can cause issues when you try to bill for services under your new tax ID number.

Steps to Take: Contact the payers and inform them of your new practice details, including your new tax ID, NPI number, and practice location. Make sure they understand that you are no longer affiliated with your previous employer.

2. Understanding Credentialing vs. Contracting

Credentialing and contracting are two distinct steps in the process, often confused for one another.

Credentialing: This is the process of verifying your qualifications and background to ensure you are fit to provide medical services. It involves a thorough check of your education, work history, malpractice history, and more.

Contracting: Once credentialed, you need to enter into contracts with insurance payers. This involves negotiating the terms under which you will provide services to patients covered by their plans.

The credentialing process must be completed before you can begin contracting. Be prepared for this to take several months, especially if you are starting from scratch or need to disassociate from a former group.

3. Effective Dates and Retroactive Coverage

A common misconception is that the date you sign a contract is the date it becomes effective. This is usually not the case. The effective date is often set one or two months after the contract is signed to allow time for the payer to update their systems.

Importance of Effective Dates: Starting to see patients before the effective date can result in claims being processed as out-of-network, leading to denied claims and financial loss.

Retroactive Coverage: Some payers may allow for retroactive effective dates, but this is not guaranteed. Always confirm whether the payer will backdate coverage for patients seen before the official effective date.

Key Takeaways

• Disassociate from former groups: Ensure that all relevant payers know you are now operating independently with a new tax ID and practice details.
• Distinguish between credentialing and contracting: Understand that credentialing must be completed before you can begin the contracting process.
• Mind the effective dates: Pay close attention to the effective dates on contracts and confirm whether payers allow retroactive coverage.

By understanding these key points, healthcare providers can avoid common pitfalls in the credentialing process and ensure a smooth transition to independent practice.

For expert assistance with credentialing, visit Physicians Credentialing.