Private Practice and Insurance Credentialing
Healthcare providers trying out into private practice often are unsure about establishing their procedures for third-party billing networks for services. The process of billing and reimbursement sometimes refers to as the “Revenue Cycle.” The first step in the revenue cycle is to obtain credentialing and a participating provider contract with insurance companies important to your service area. Building a successful revenue cycle for a new practice can be a complicated matter. Still, with a bit of planning, you can make the process seem a bit less intimidating. Here are some of the critical steps in the process to provide you with a little bit of guidance in setting up the revenue cycle for your new private practice.
Prepare for Credentialing
Credentialing is a process that insurance companies use to verify your education, training, and professional experience. Ensure that you meet their internal requirements to serve as an in-network provider on their panel. Insurance companies are required to provide web-based provider directories listing all in-network providers for their plans. Healthcare service consumers regularly use these online directories to locate physicians and other healthcare providers who accept their insurance. The first step in implementing your new revenue cycle is to get credentialed and contracted with the insurance plans that are important to your service area. Once complete, consumers will be able to locate you as a participating provider in their panel for your specific specialty.
The process of “credentialing” or “provider enrollment” with an insurance network consists of two phases.
1) Credentialing and 2) Contracting. The credentialing phase is when the insurance company verifies all your credentials and meets their requirements for participating in their network. The contracting phase is where the company issues you a participating provider agreement that defines the terms of participation for receiving in-network reimbursement for your claims.
Without a participating provider agreement, you will not receive in-network reimbursement. Until your credentialing and contracting are complete, you may have the option to bill the network as an out-of-network provider. Still, there is no guarantee that your claim to process. Whether or not your claim is even accepted depends on if the patient’s policy has out-of-network benefits. Government health plans such as Medicare and Medicaid will not pay for any out-of-network services.
Which Insurance Companies Should I Credential With?
Consider asking a peer in practice in your area or an office manager who handles billing in your area what insurance companies provide the most patient base. That practical knowledge about local insurance companies can be a valuable major. National plans to consider including Aetna, Blue Cross Blue Shield, Cigna, United Healthcare, Humana, Medicare, and Medicaid. There are many Medicare Advantage plans as well as managed Medicaid plans for consideration as well. Some major national PPO plans rent their network, such as Multiplan that can be important in certain areas.
Checklist items for credentialing and contracting preparation:
- Consider establishing a business entity under which to practice (LLC, S-Corp, PC, etc.) and obtain your tax ID.
- If operating as a sole proprietor, consider obtaining a federal tax ID to operate under instead of your SSN
- Obtain your professional liability insurance policy
- Obtain an NPI number for you individually (type 1) and your business entity (type 2)
- Be fully licensed in the state where you will provide services (including prescriptive authority)
- Please create a profile with CAQH and keep it current.
- Have your practice location ready
- Know which insurance networks you want to participate with
Credentialing With Insurance Networks
- The process is time-consuming. Once you have prepared for the operation and know which insurance companies you want to participate with, it’s time to get started. Expect to spend anywhere from 2 – 6 hours on each application when considering application preparation and follow-up throughout the entire process. In many instances, it will make economic sense to outsource this critical revenue cycle step. At the same time, you focus on treating patients or work on other business-building activities.
- Many physicians and other healthcare practitioners starting a new practice who previously worked for another organization often think that since they are already in-network with an insurance company, little or nothing needs to be done for their unique private practice. Those providers participated under the previous organization’s group contract in many situations, which will not transfer to the new private practice. Do not assume in these situations that your credentialing process will be any faster with the insurance companies. Contact each plan to determine your contract status and get instruction on setting up your new practice. Some will require you to go through the entire process from the beginning; others may have abbreviated processes to get a new private practice contract issued. Suppose you were participating with the previous organization under an individual contract. In that case, you may be able to transfer your contract to your new private practice. The process varies widely by plan.
- Be aware that the credentialing process may take several months. Many insurance companies may not accept new providers on their panels. Also, networks may not be getting new providers in your service area. In which case, your options are to appeal their decision (successful appeal is extremely rare) or continue to apply every six months in case they open up availability. Suppose you were participating in a network under a previous employer or organization contract. In that case, you may still receive a rejection from issuing a participating provider contract if the network is not accepting new providers in your area since the agreement would be a new issue for the web.
Checklist for beginning the process
- Contact the network provider services department to inquire about their credentialing process and obtain a credentialing application. Most plans have applications and information on their website, such as here with Aetna.
- Take time to fully complete your application listing all service locations for your practice, sign and date your application, and include copies of all required documents.
- Ensure that your CAQH profile is up to date with all information, mainly practice location information, and includes copies of all required documents such as license, insurance, board certifications, etc
- Retain a copy of your completed and submitted an application
- Verify with the insurance company that your credentialing application was received, and follow up with the insurance network regularly until your credentialing is complete and you have an effective network date with a participating provider agreement
- Respond to any requests for additional information that the insurance company may have
- Document all of your follow-up activities as you go through the credentialing process.
- Review your participating provider contract for details of your requirements as a network provider, claims submission procedures, fee schedule for your services, timely filing limits, and other essential contract terms.
- Keep copies of all credentialing applications and contracts submitted. Be sure to retain a final copy of your network contract.
- When your credentialing process is complete, you are ready to begin billing the network for services. Here are a few key things to remember about maintaining your credentials:
- Access the network website so that you can confirm you are listed in their directory. Most networks also have access to claims filing, benefits verification, claims follow-up, and other revenue cycle activities on their website.
- Record all contact information for the insurance company related to claims filing, contracting, and credentialing.
- Record your provider id, effective date, and when your following re-credentialing process will be due
- Maintain copies of all your network contacts in one central location for ease of management
- After a year of service, evaluate which networks are providing patient volume and compare reimbursements to identify carriers to eliminate or renegotiate reimbursement rates.
- Maintain your CAQH profile by quarterly attestations and document updates any time you renew an item such as license or malpractice insurance
- Maintain your NPPES records so that your NPI numbers always reflect the accurate name, address, and other information
- Do not neglect re-credentialing requests from plans or requests for renewed or additional documents. Failing to respond to a request can lead to the network termination.
- Now that you are a participating provider, you are ready to begin billing the health plan for your services. Billing is another area of the revenue cycle that is often better for outsourcing than doing in-house. Small practices can achieve a real advantage by outsourcing to a billing company the duties of claims submission and follow-up for reimbursement. Some key things to remember as you begin billing for your services:
- Verify patient benefits before treatment
- Collect copayment and coinsurance at the time of treatment
- Submit your claim within 24 hours of treatment
- Know the time in which the plan is required to pay your claim according to your contract and follow up on any claims that have not been paid in that timeframe
- Promptly post insurance payments and bill the secondary payer (insurance company or patient) for any balance.
- Retain copies of all EOBs received for payments
- Know what services you are required to obtain pre-authorization for and receive those as necessary (pre-authorization is the provider’s responsibility)
- Keep up to date with plan rules and procedures about billing for your services.