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3 Ways Your Inefficient Healthcare Credentialing Process Is Putting Your Organization at Risk

The purpose of healthcare credentialing isn’t just to ensure your organization’s latest hires have been honest about their qualifications. Healthcare credentialing exists to shelter your organization from legal, financial, and reputational risk.

Especially now, as healthcare organizations across America look to regain their pre-COVID momentum, any type of setback can be devastating. Healthcare organizations simply cannot afford to make mistakes.

Unfortunately, the healthcare credentialing process for many organizations remains as time-consuming, costly, and error-prone as ever.

Why the Conventional Healthcare Credentialing Process Is So Inefficient

Typically, healthcare employers either staff their own credentialing departments or outsource the work to a third-party credentials verification organization (CVO). Either way, the process is largely manual.

A credentialing team for a large healthcare employer can consist of 15 or more people whose jobs involve running searches through various government databases.

As with any manual process, as the workload intensifies (for example, during the expected post-COVID hiring boom), the potential for human error increases. People can become overwhelmed, quit, get sick, or even be delayed by bad weather. In a matter of days, the whole credentialing process can descend into chaos.

This level of inefficiency and complication doesn’t just affect your organization’s ability to onboard new hires. The credentials of your current team members must be periodically verified, as well. The healthcare field moves quickly, and qualifications must be updated continuously.

Any uncertainty about your employees’ certification status represents a risk to your organization. Three of the most dangerous risks are:

1. Employing an Uncertified Individual

Healthcare workers can allow their licenses to lapse for a number of reasons.

Most often, it’s an oversight; the employee simply doesn’t realize the expiration date is near and fails to initiate the renewal process on time. (Considering how many healthcare professionals are currently distracted by COVID-related stress, we can surmise that there have been many such oversights recently.)

Medical licenses can also be revoked for certain bad behaviors, such as substance abuse, patient abuse, sexual misconduct, malpractice, and Medicare fraud. These issues aren’t quite as forgivable as forgetting to file a form.

Whatever the cause, employing even one person who does not possess the proper credentials to practice in your state can be extremely damaging to your organization.

Last February, a pharmacy chain made nationwide news after being accused of employing an unlicensed pharmacist for over a decade. The chain settled a consumer protection lawsuit in California for $7.5 million. The district attorney who prosecuted the case offered this warning to other healthcare providers:

“The burden is on the company to make sure its employees are properly licensed and to complete a thorough background check.”

2. Jeopardizing Medicaid/Medicare Reimbursements

To say that healthcare organizations can’t put their ability to collect Medicaid and Medicare payments at risk would be an understatement.

The Centers for Medicare and Medicaid Services (CMS) is the single largest payer of healthcare expenses in the United States. As of 2020, Medicare and Medicaid combined accounted for nearly 35% of all hospital revenue.

Healthcare providers must be properly credentialed to qualify for CMS reimbursement. So, if you hire a new physician, they will not be able to see Medicare or Medicaid patients until they can be credentialed.

In addition, with each incident of employing an uncredentialed person, healthcare organizations can face fines from the U.S. Department of Health and Human Services (HHS) of $10,000 or more. HHS can also exclude providers from federally funded healthcare programs — such as Medicare and Medicaid — through its Office of Inspector General.

3. Losing Accreditation

Accreditation groups such as the Joint Commission on Accreditation of Healthcare Organizations set standards on provider credentials. These standards must be followed to qualify for accreditation.

While accreditation is not strictly mandatory for healthcare organizations, accreditation helps establish patient trust, keeps healthcare organizations competitive in the marketplace, attracts high-quality job applicants, and reduces insurance costs — among other benefits.

Plus, accreditation is often a requirement for insurance or Medicare/Medicaid reimbursement.

A More Efficient and Reliable Credentialing Process

In the past few decades, digital technology has transformed healthcare in the United States, allowing organizations to function more efficiently, reduce costs, and preserve more lives. Tasks that once took huge expenditures of time, money, and people can now be completed in moments with the click of a mouse.

Credentialing will be the next area to undergo this transformation.

Cutting-edge software now exists that can automate the credentialing process, connecting organizations to direct, real-time information feeds from hundreds of primary sources. Instead of paying roomfuls of researchers to recheck each of your employees periodically, you can simply wait for instant notifications from the automated system.


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