How much does physician credentialing cost?

Credentialing costs include more than a service fee. Compare staff and provider time, technology, payer follow-up and the potential effect of enrollment delays on billing. This guide explains how to estimate in-house costs and compare them with an outsourced proposal.

For internal budgeting, separate direct administrative costs from the financial effects of enrollment delays. The historical example below does not include payer follow-up or verification of the enrollment effective date, so include those tasks when estimating your own costs.

Direct credentialing costs are usually absorbed by dedicated staff or another department, such as billing. Outsourcing can transfer much of the administrative work, but providers still need to supply information, review details and sign documents. Budget for completing and reviewing applications, gathering records, responding to follow-up requests and tracking progress.

A historical in-house cost example

These assumptions come from the earlier version of this article. They illustrate the calculation, not current wages, market rates or a PPS quote. Replace each assumption with your practice’s actual costs.

Physician time

$557.00 3.4 hours at $163.96/hour, rounded in the original example

Support staff time

$604.50 31 hours at $19.50/hour

Labor subtotal

$1,161.50

Illustrative 30% labor overhead

$348.45

Technology and hardware

$150.00

Illustrative total per physician

$1,659.95

This example assumes a dedicated, experienced credentialing staff member starts work when the physician signs a contract. It does not represent every practice, provider or payer combination.

Delays can begin before an application reaches a payer. Assign responsibility for gathering documents and completing each application as soon as the provider’s start is planned. Familiarity with payer-specific requirements helps staff identify missing information and plan follow-up.

Billing and cash-flow effects are separate from administrative costs. An enrollment delay may postpone when a practice can bill or receive payment. The effect depends on the payer agreement, enrollment effective date and applicable billing rules. For a facility-based practice with an income guarantee, the facility may also carry provider compensation while enrollment is pending.

Avoid building a budget around a single promised enrollment timeline. Ask about your payer, application type and outstanding requirements. For Medicare, CMS provides current enrollment application guidance and notes that online PECOS applications tend to process faster than paper applications. PPS can help you plan the enrollment work for your situation.

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Fees vary with the number of providers and plans, the type of enrollment and the work included. Packages may cover a defined number of payer applications. Ask for a written scope so you can compare application preparation, submission, follow-up and ongoing maintenance consistently.

The time, expertise and attention to detail required are important reasons to consider outsourcing. If you manage credentialing in-house, assign it to someone with the relevant experience and enough capacity to complete applications and follow up. Include training and coverage during staff absences in your decision.

For an established practice, estimate your internal costs before deciding whether to outsource or keep credentialing in-house. Use the historical calculation above as a method, with your own figures. Our guide to when outsourcing credentialing makes sense explores that decision further.

For a new practice, prepare a list of providers, locations and target payer plans before requesting a quote. Our free credentialing checklist can help you organize the information.

An efficient credentialing process supports the transition from provider onboarding to billing. Compare the full cost of doing the work internally with the scope and fee of an outside service.

In larger groups, application tracking and staffing coverage can add substantially to the workload. A clear process, current records and assigned follow-up responsibilities help you understand the resources needed.

Earlier source update: April 4, 2023. Cost figures above are retained only as historical illustrations.