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Credentialing, Contracting, & Understanding Eligibility

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Medicaid is transitioning to Managed Care plans more and more every year. More states are Billing insurance can be an incredibly lucrative venture for providers looking to boost their revenue. Working with payers gives a behavioral health provider access to built-in marketing, a strong patient base, and regular sources of revenue that can all help a practice grow. With those benefits come challenges including credentialing, contracting, enrollment, and eligibility. Keep reading to learn more about each challenge and how to manage them.

Credentialing Challenges

  • Missing Educational History 
  • Missing Clinical Work History 
  • List of Clinical Specialties 
  • Outdated License Information 
  • Missing Liability Insurance 
  • Background Checks delays 
  • Outdated information/address 
  • Delays from the overall process 
  • Lack of tracking tools 
  • Lack of staff to perform credentialing

Payer Contracting Challenges

  • Identifying accurate reimbursement and underpayments for appeals 
  • Reporting on underpayments in an organized way, for rework 
  • Having tools to measure reimbursement accuracy

Provider Enrollment Challenges

  • Payers are non-responsive 
  • Paperwork gets lost – no tracking 
  • Incomplete enrollment forms 
  • Lack of staff to perform payer enrollment

Time Management is the Most Pressing Credentialing Challenge

 Time management is a huge issue when it comes to the credentialing process. Many organizations jump ahead in the hiring process, causing bigger issues down the line. They often hire the provider and set their start date prior to ever verifying their credentials. 

This is actually the opposite of what is most efficient. Depending on the payer, credentialing can take anywhere from 4 weeks to 4 months. What ends up happening is that organizations jeopardize compliance with certain payers, especially government-run insurance companies. Failing to adhere to compliance regulations can cause you to forfeit important reimbursements. If a provider is not credentialed then they are unable to bill and collect for that revenue. By making the credentialing process your last step instead of your first, you actually end up inconveniencing providers and patients, overcomplicating the entire process.

Instead, organizations should start by verifying a provider’s credentials before hiring them. Once that is completed they then can set a start date and complete provider enrollment. 

Overcoming Other Credentialing Issues

  1. Keeping contact and licensing info current – this is extremely important in order to streamline credentialing processes. 
  2. Make sure to have an in-house credentialing team or an outsourced team that can complete and track these processes for you. 
  3. Pay special attention to special state compliance guidelines – every state is different and must be adhered to with diligent attention. 
  4. Use a credentialing system or ensure your vendor has the tools to track the process. 

Understanding Eligibility

The process of verifying eligibility is one that all providers participate in. If a client is not eligible to receive services, then you will not be able to bill for reimbursement. If a client’s coverage has lapsed, then you will not be able to bill their insurance for reimbursement. If the client has a carve-out plan, then you need to make sure you are billing to the right payer. All of these challenges contribute to the importance of eligibility verification.

Important Eligibility Questions to Ask Clients/Patients

  1. Does your client’s health plan have benefits for outpatient mental health in an office setting? 
  2. Are you considered an “in-network” provider on that client’s plan?
  3. Does the client’s health plan need pre-authorization? 
  4. Does the policy holder’s plan cover your specialty through an Employee Assistance Program instead of a health plan?
  5. Are there exclusions to the policy or maximum benefits that need to be adhered to? 
  6. Are there authorization limits on the client’s health plan?

What Are Carve Out In-Network vs. Out-of-Network Plans?

laptop on table with Logik

A carve-out plan is when an insurance payer literally “carves out” specific services from a health plan. This happens rather frequently with mental health services. Payers “carve-out” a member’s mental health benefits and contract them out to a third party for coverage.

If a provider is in-network with a carve-out, the only negative impact is that the provider has to direct the claim to the appropriate payer. 

With a provider that is not in-network with a carve-out plan, then you are considered an out-of-network provider with the member’s policy. This can happen when you accept their health insurance, but not the insurance that the plan has been outsourced.

To learn more about how you can improve each of these processes, download our free white paper below.

Schedule a consultation now to learn more about how your facility can maximize reimbursements.

Contracting, Credentialing, Eligibility White Paper



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