Delegated Credentialing: What It Is and When It Makes Sense 

Delegated Credentialing: What It Is and When It Makes Sense 

A healthcare organization working closely with the patient doesn’t have much time to waste on in-house credentials. The best way is to hand over this responsibility to a trusted party or organization. Delegated credentialing is perfect for this. Here is everything you need to know about the process of delegated credentialing in healthcare.  

Taking the help of any other trusted party, like a credentialing verification organization (CVO) or managed care organization (MCO), for credentialing its own healthcare providers falls under the category of delegated credentialing. The party that is held responsible for performing the credentialing is called a delegated entity or client.  

In 2025, NCQA made new rules in response to the challenges brought to light by recent market insights. The tendency towards delegated credentialing has changed as a result of revised policies that emphasize the drawbacks of manual approaches.  

Using the recent data analysis, the delegated credentialing has helped both the payer and provider group. 

Consider a large hospital that is working in collaboration with the MSO (Management Services Organization. MSO is best known for dealing with the non-clinical services for patient care, like financial management, IT issues, HR services, and quality assurance programs. Appointing a third-party for dealing with the credentialing issues of healthcare providers relieves the burden from their shoulders. Dealing with the accreditation bodies and credentialing committee is no longer a concern for them to worry about.  

How Delegated Credentialing Works?  

Where do your healthcare providers stand? If you are the one who does not compromise on the quality of healthcare services and the reputation of the organization, delegated credentialing is the best way to get rid of these worries. The question is how to start and how it proceeds. Following is the step-by-step guide showing how delegated credentialing program works: 

Delegation Agreement: One of the prerequisites is the delegation agreement, which is a mutual agreement made between a credentialing organization and a payer organization. Outlining the responsibilities, performance metrics, and services in accordance with the policies, considering the terms and conditions of the regulatory bodies like NCQA, CMS, URAC, and laws of the state, ensures the smooth processing.  

Collecting Data: The next step is to collect all the data from the healthcare providers regarding their personal information, employment history, licensures, and professional recommendations.  

Verifying the Authenticity of Data: The credentialing body looks for the authenticity of the provided information by contacting the educational institutes and healthcare organizations to ensure error-free credentialing. 

Provision of Credentials: Once data verification is complete, the healthcare organization provides credentials to the healthcare providers depending on the outcomes of data verification and recommendations of the provider group.  

Monitoring and Re-credentialing: Monitoring is essential once delegated credentialing is completed to ensure that healthcare providers align with the optimum standards and updated qualifications.  

Who Qualifies (Operational and Compliance Requirements)  

Let’s have a look at the basic requirements for qualifying for the credentialing programs in accordance with the compliant clauses.  

NCQA delegation standards adhere to different compliance requirements, the most important of which is a specific time lapse for primary source verifications (PSV). The following table shows the list of operational requirements along with their PSV time frame. 

Requirements	PSV Time Limit
License	180 days
Malpractice history: The delegated organization looks for the previous five years of malpractice from the national practitioner bank.	180 days
Work history: Healthcare workers have to give the reason for the employment gap if it is more than six months. The reason for the employment gap is included in the credential file.	365 days
Malpractice history: The delegated organization looks for the previous five years malpractice from the national practitioner bank.	180 days
Note:   Regarding education and CDS or DEA certification, no time limit is present. However, it is advised to take it before the day the committee decides.

The provider must know about the regulations of different operating regions to adjust their policies in due course. One must know the types of credentialing bodies to have a better understanding of delegated credentialing program requirements.  

Types of Delegated Credentialing Bodies:  

Credentialing Accreditation	– Provider group – Have complete authority for credentialing along with the committee approval process.
CVO certification	– Healthcare group – No complete authority and also needs committee approval for the process.

Oversight, Audits, and Quality Metrics 

The surveillance of delegated authorities is essential to keep a check on whether the responsibilities assigned by the delegated group have been fulfilled or not. Shared delegation compliance audits can work for the required field. Main aspects to focus on during the audit of the delegated group are given below:  

• Reviewing delegated agreements and appointment letters.  

• Assessment of risk management framework for streamlining delegated functions.  

• Reviewing the customer feedback section to ensure that the delegated party is doing its work with honesty.  

• One of the main concerns is assessing how the delegated organization deals with conflicts of interest without disrupting the basic code of conduct.  

• The computation of financial records, including billings, invoices, payment processing, and transactions, is the task of the auditor to ensure fair financial account management.  

• Assessment for credentialing and enrollment services of the delegated staff to estimate their worthiness to work in the healthcare organization.  

• The shared delegation audit identifies the areas of improvement to address the shortcomings of the organization and improve its efficacy.  

Hence, the audit group makes sure to control the risks, enhance efficacy, create room for improvement, and assess whether the delegated entities are performing their duties according to the demands of the healthcare organization or not.  

Pros and Cons for Receiving Groups  

Pros

Cons

Privacy Issues:  Sharing private information with a third party raises concerns regarding privacy. Personal information of healthcare providers is at stake if the third party does not take any precautionary measures for data protection. There is a need to adhere to regulatory bodies for data protection, like the Health Insurance Portability and Accountability Act.   Dependency on Third Party:  If the organization is going through any crisis, the dependency on an external body dealing with credentialing makes it difficult for the people to deal with in-house problems.   Chances of Miscommunication:  The working relationship between both parties speaks a ton about the smoothness of work. Miscommunication can lead to delays in the functional operations related to credentialing programs. It not only affects the staff but also affects the efficacy and patient care of healthcare organizations.   Lack of Credentialing Knowledge:  When the healthcare organization knows that an outside party is controlling the credentialing process, they do not pay much attention to the details of the process and hence are deprived of the basic information about in-house credentials.   Legal Challenges:  With the delegation agreement, there come the legal clauses that need to be followed. In case any one of the parties wants to terminate the agreement, legal action is taken, or sometimes they must deal with the penalties.

Privacy Issues:  Sharing private information with a third party raises concerns regarding privacy. Personal information of healthcare providers is at stake if the third party does not take any precautionary measures for data protection. There is a need to adhere to regulatory bodies for data protection, like the Health Insurance Portability and Accountability Act.   Dependency on Third Party:  If the organization is going through any crisis, the dependency on an external body dealing with credentialing makes it difficult for the people to deal with in-house problems.   Chances of Miscommunication:  The working relationship between both parties speaks a ton about the smoothness of work. Miscommunication can lead to delays in the functional operations related to credentialing programs. It not only affects the staff but also affects the efficacy and patient care of healthcare organizations.   Lack of Credentialing Knowledge: When the healthcare organization knows that an outside party is controlling the credentialing process, they do not pay much attention to the details of the process and, hence, are deprived of the basic information about in-house credentials.   Legal Challenges:  With the delegation agreement, there come the legal clauses that need to be followed. In case any one of the parties wants to terminate the agreement, legal action is taken, or sometimes they must deal with the penalties.

Pros and Cons for Provider Group 

Pros	Cons
Responsibility comes with challenges. Sometimes, it is difficult to meet the complex compliance audits for the credentialing process. The delegated entity has to make sure that they have professionals with updated and authorized knowledge to keep up with the credentialing program.  They may face issues regarding timely submissions and regular audits.	Responsibility comes with challenges. Sometimes, it is difficult to meet the complex compliance audits for the credentialing process. The delegated entity has to make sure that they have professionals with updated and authorized knowledge to keep up with the credentialing program.  They may face issues regarding timely submissions and regular audits.

Getting Ready: Data, Policies, Team  

Delegated credentialing is best for running a healthcare organization effectively. Before getting ready for the process, make sure to tick the following boxes: 

• Know the basics of delegated credentialing. 

• Completion of pre-delegated requirements. 

• Sustaining compliance with state regulations and industry principles.  

• Securing expert support for the long run.   

The provider group can take help from the experienced delegated credentialing consultant to assess the compliance with state regulations, make an effective credentialing committee, form new policies or review the old ones.  

Frequently Asked Questions:  

1. What is the difference between delegated credentialing and non-delegated credentialing?  

Delegated credentialing refers to handling the verification of credentials of healthcare providers to a third party, while non-delegated credentialing, or credentialing, involves performing the credential verification process by in-house staff. 

2. How much time does delegated credentialing take?  

Delegated credentialing takes on average a few weeks to months. The duration depends on the scale of the healthcare organization and the volume of data.  

3. What is the average cost of the delegated credentialing program?  

The cost depends on the agreement between the payer and the delegated party. However, it depends on the extent of services the organization receives and the duration for which the agreement is valid.  

4. Do payers accept delegated credentialing?  

No, not every payer can accept delegated credentialing. The payer agreement put forward by the paying group lists the necessary requirements depending on the company and region.  

Final Verdict:  

Delegated credentialing is not everyone’s cup of tea. However, educating yourself regarding the credentialing and its requirements is beneficial for both healthcare providers and provider groups. Make sure the organization is eligible to participate in the credentialing process. Both parties should be clear about what the delegated credentialing means. 

Don’t burden yourself with the ifs and buts of delegated credentialing. Still confused about payer delegation? Get help from our credentialing experts at Credex Healthcare. At Credex, we value delegation oversight.