Nobody plans to lose three months of revenue. But that’s exactly what happened to a small orthopedic clinic in Southern California when they brought on a new physician and skipped a step they assumed wasn’t urgent.
The provider began to treat patients on Day One. Staff were trained. The program was packed. So far so good, and the EOBs were beginning to arrive, all of which were denials.
The reason? The doctor had not yet been accepted by any insurance company.
That one mistake resulted in the loss of an estimated $80,000 of revenue that was lost and written off by the clinic. The worst of it is, it all could have been avoided.
What Is Medical Credentialing and Why Does It Matter So Much
The credentialing process involves confirming a provider’s credentials, licenses, education, training, malpractice history, and certifications, and enrolling the provider with insurance payers in order to be able to bill for services.
Most large insurers will not pay claims against that provider’s NPI until that process is finished. A few payers will bill retroactively after credentialing, but many won’t, and those that will typically have time limits and paperwork requirements.
This is why there are professional medical credentialing services such as www.doctormgt.com. Not to make things more complicated for you with paperwork, but so that your revenue will not be lost to a situation like the one above.
If a practice does not have a specialist handling the credentialing process or if they do it internally and less effectively, the risk is great, or at best, they are not doing the process at all.
How Long Does Credentialing Actually Take?
This is where most practices get caught off guard.
The typical credentialing process takes anywhere from 60 to 120 days per payer, depending on how long it takes the insurance company to process the application, the provider’s specialty, the thoroughness of the application, and the response time of the verification sources.
There are different enrollment periods for Medicare and Medicaid. If there’s anything missing, even if it’s a different address, a missed CAQH attestation, the clock resets the moment it was restored. If there’s anything missing, even if it’s a different address, a missed CAQH attestation, the clock resets the moment it was restored.
That means months with a new provider for which they haven’t collected any insurance reimbursement.
That’s why medical credentialing services should begin before a provider’s first patient, preferably 90 to 120 days prior to the provider’s first patient.
The Mistakes Practices Make Again and Again
The orthopedic clinic in this story is by no means an exception. These situations occur regularly in independent practices, specialty clinics, and even larger group practices that don’t anticipate the intricacies of credentialing.
The top five reasons for losing revenue are:
- After the hire is confirmed, the credentialing process has been underway and you’ve lost weeks of lead time.
- They are two distinct processes, assuming the hospital privileges are equal to the insurance enrollment, and one does not necessarily replace the other.
- Many payers pull directly from CAQH, and an outdated profile slows down the application, leaving the CAQH profile incomplete or outdated.
- Not keeping track of deadlines and expiration dates, credentialing is not a single event – licenses, DEA registrations, and malpractice coverage all expire.
- Most clinicians do not have training in credentialing, and consequently do not know how it should be done, and should not be expected to, as most rely on the provider to manage credentialing themselves.
All of these errors are correctable, but time spent in billing is money spent, and that is the time to recover from the error.
What Professional Medical Credentialing Services Actually Do?
Outsourcing to a dedicated medical credentialing services provider isn’t just about convenience. It’s about accuracy, speed, and revenue protection.
Here’s what a qualified credentialing team handles on your behalf:
Primary Source Verification
Confirming licenses, board certifications, education, and malpractice history directly with the issuing organizations, as required by payers and accreditation bodies.
Payer Enrollment Management
Submitting applications to each insurance network, tracking progress, following up on pending items, and communicating with payer representatives until enrollment is confirmed.
CAQH Profile Maintenance
Keeping provider profiles updated and re-attested on schedule so applications don’t get held up by outdated information.
Credentialing Timeline Tracking
Monitoring every application with clear status updates so your practice knows exactly where each provider stands with each payer at any point in time.
Re-credentialing and Expiration Monitoring
Flagging upcoming expirations for licenses, DEA registrations, and malpractice certificates so nothing lapses without notice.
When all of this is managed proactively, your providers can start billing from day one — or as close to it as payer timelines allow instead of sitting in a revenue gap that nobody saw coming.
The Real Cost of Doing It Wrong
In addition to the loss of revenue, there are downstream issues that rapidly compound because of credentialing gaps.
Claims that arrive prior to enrollment verification will frequently have to be resubmitted or appealed. Some payers identify practices due to billing that do not comply. But if it’s not caught quickly, it may impact your participation with payers completely.
The administrative expenses that go into resolving the credentialing snafu, such as staff hours, appeals, resubmissions and patient billing adjustments, can far surpass the revenue loss.
Don’t Learn This Lesson the Hard Way
Eventually, the clinic in this story bounced back. The credentialing of new providers was finalized, some billing of providers for retroactive services was turned down by certain payers, and processes were reframed for future providers. However, cash flow took a hit during those 90 days, and it took a few more months to get it right.
No practice should have to absorb that kind of hit.
If you’re onboarding a new provider, expanding to a new location, or adding a new specialty — start your credentialing process now. Work with medical credentialing services that track timelines, manage payer communication, and keep your revenue cycle moving without interruption.
Your providers are ready to work from day one. Make sure your credentialing is too.
