Clinicians Business Tip: Credentialing and Contracting: There is a Difference

Nurse practitioners and other clinicians often send in questions about credentialing and contracting. It’s clear, from those questions that there is some confusion about the two and it’s important that all health care providers understand the difference.

Credentialing is a process where the company attempts to make sure that you are you. They want to make sure that you are an excellent health care provider, and that you don’t have any of the red flags swirling around your head.

What do I mean by that?  Items of concern include malpractice claims, complaints against your license, lawsuits, loss of credentialing at other companies, addiction issues, and a whole host of other things.

I’m sure you are aware that insurances or third party payers are not the only companies that will put you through a credentialing process. You may find that you will need to be credentialed in order to work with a clinic, university or to be on staff at your local hospital.

Contracting – regardless if it’s insurance or employment contracting – it takes place after you have gone through the credentialing process and they have decided that you are a great provider for their patients. Keep in mind, contracts are not going to be offered to someone who does not meet the standards for a health care provider in their company.

Contracts outline the terms of the working relationship. In the case of insurance contracts, they will cover your responsibility to them and their patients. Additionally, they’ll tell you what they will do for you as well as what you’ll need to do in order to get paid and how much they will pay you. Because of this, you’ll want to negotiate the terms of your contract. And as always, read your contracts thoroughly before signing them.
So there you have it. Think of credentialing as a vetting process and contracting as the written terms of agreement.
I invite you to ask your questions or leave comments below about your own credentialing and contracting experiences.

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  1. I’m going to be looking for a new FNP job soon. I currently work as a primary care provider and I’m periodically credentialed by my current employer. Does mentioning this current credentialing help prospective employers when they are considering me as a new hire FNP? Should I mention I’m credentialed on my resume, or in an interview? Thanks for your reply!

  2. Hi Linda,

    Credentialing is likely not going to help you get a job per se. In in job, your employer will have to credential you with insurance companies, under their company billing numbers again. It may make the process a bit faster, but that would be the extent of it.

    Hope this helps.

  3. I am planning on eventually starting my own practice. What can I expect from the payers, as I leave my employer’s practice and start my own? Will they recredential as if I were new to them, or will the process be easier?

  4. Hi Dorine,

    Good question and the answer is, it depends. Medicare will ask you to recredential. Medicaid may or may not. Private payers, may or may not depending on their policies. At the very least, they will want your business taxid, business npi and your office information. As you get closer to the time, start calling them and asking them how they want you to proceed. Thanks for stopping by and asking your question. Good luck!

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