Medical credentialing is one of the most important steps in starting or expanding a medical practice — yet it’s also one of the most confusing. Every payer has its own rules, its own forms, and its own timelines. And if a provider is not properly credentialed, claims will be denied, payments will be delayed, and in many cases, it becomes illegal to bill for services.
In this post, we’ll break down what credentialing actually is, and then walk through the credentialing requirements for Medicare, Medicaid, and commercial insurance plans in simple, easy-to-understand terms. No jargon. No complicated explanations. Just clear guidance you can use right away.
What Is Medical Credentialing?
Medical credentialing is the process of proving that a healthcare provider is qualified, trained, and safe to treat patients.
Insurance companies and government programs must verify this before they allow a doctor, nurse practitioner, therapist, or any other licensed clinician to:
- Join their network
- Bill for services
- Receive payment for claims
Credentialing checks things like:
- Medical school graduation
- Residency or training
- State license
- DEA registration (if prescribing)
- Board certification
- Work history
- Malpractice coverage
- Any past disciplinary actions
Think of it like a background check, but for medical professionals — making sure everything is clean, verified, and up to date.
Why Credentialing Matters for Your Practice
If a provider isn’t properly credentialed:
- You cannot bill that payer.
- Claims will get denied.
- Revenue gets delayed by months.
- Patients may switch providers.
- You risk compliance issues.
For small practices especially, credentialing delays can seriously affect cash flow. That’s why understanding the specific requirements of Medicare, Medicaid, and commercial plans is crucial.
Credentialing Requirements by Payer Type
Below, we break down what each payer typically requires and how their processes differ.
1. Medicare Credentialing Requirements
Medicare is managed by CMS (the Centers for Medicare & Medicaid Services) and processed through MACs — Medicare Administrative Contractors. Every state has its own MAC.
Here’s what Medicare generally requires:
1. Licensure Verification
You must hold an active, unrestricted license to practice in the state where you’ll treat Medicare patients.
2. NPI (National Provider Identifier)
A provider must have:
- An Individual NPI (Type 1)
- The organization must have an Organizational NPI (Type 2)
Both are required for credentialing and billing.
3. Completed Medicare Enrollment Application (PECOS)
PECOS is the online system used for Medicare enrollment. You’ll need to complete:
- 855I (for individual providers)
- 855B (for group practices)
- 855R (to reassign benefits to the group)
Tip: PECOS is the fastest way; paper forms take longer.
4. IRS Documentation
Medicare requires:
- W-9 form
- EIN verification
- Group ownership details
5. Practice Location Verification
Medicare checks that your practice:
- Exists physically
- Meets Medicare safety and compliance standards
- Has a working phone number and posted hours
They may conduct a site visit.
6. Malpractice (Liability) Insurance
You must provide proof of current, adequate insurance coverage.
7. Background Checks
Medicare screens for:
- Sanctions
- Exclusions
- Disciplinary actions
Providers listed on the OIG Exclusion List cannot enroll.
8. Medicare Processing Time
Typically, 60–90 days, but it can take longer if forms are incomplete or if they request additional documents.
2. Medicaid Credentialing Requirements
Medicaid is state-run, so rules vary widely. However, most states share similar core requirements.
Here’s what Medicaid usually asks for:
1. Active State License
The provider must be licensed in the state where Medicaid services will be provided.
2. NPI Number
Both individual and group NPIs are required.
3. Medicaid Provider Enrollment Form
Every state has its own enrollment portal or application, such as:
- TMHP (Texas)
- Medi-Cal (California)
- NCTracks (North Carolina)
You may need to complete both:
- An individual application
- A group or facility application
4. Background Checks
Medicaid conducts:
- State-level background checks
- OIG verification
- Fingerprinting (in some states)
- Criminal history reviews (in certain specialties)
5. CAQH Profile (Optional but Helpful)
Some Medicaid programs pull data from CAQH for verification, though it’s not always required.
6. Malpractice Insurance
Current and adequate coverage is a must.
7. Additional State-Specific Requirements
States may ask for:
- Proof of immunization (in pediatric practices)
- Hospital privileges
- CME credits
- Supervisory agreements (for NPs or PAs)
- Telehealth documentation
8. Medicaid Processing Time
Ranges from 45–120 days, depending on the state. Some states are much slower.
3. Commercial Payer Credentialing Requirements
Commercial payers include plans like:
- Blue Cross Blue Shield
- UnitedHealthcare
- Aetna
- Cigna
- Humana
- Kaiser
- And regional insurance plans
These insurers have similar requirements but stricter documentation standards.
1. CAQH Enrollment
Nearly all commercial insurers require an updated, attested CAQH profile.
Your CAQH profile must include:
- Education and training
- Work history
- Licenses
- Board certifications
- Malpractice insurance
- References
- Procedure logs (for some specialties)
Tip: Attest your CAQH every 90 days to avoid delays.
2. State License
Must be active and unencumbered.
3. DEA Certificate
Required if the provider prescribes controlled substances.
4. Malpractice Coverage
Policy limits must meet the insurer’s minimum requirements.
Example: Many commercial plans require $1M / $3M coverage.
5. Hospital Privileges
Some payers require hospital admitting privileges or a formal plan for emergency coverage.
Example: A surgeon without privileges must show a collaborating hospital arrangement.
6. Practice Details
Commercial payers will request:
- Tax ID (EIN)
- Group NPI
- Practice address
- Credentialing contact
- Signed contract agreements
- W-9 form
7. Provider Directory Accuracy
After approval, providers are added to the payer’s directory. Keeping this updated is required to avoid compliance issues.
8. Commercial Payer Processing Time
Typically, 60–120 days, depending on the insurer’s workload.
How to Avoid Common Credentialing Problems
Regardless of the payer, credentialing failures typically fall into a few categories:
1. Missing Documents
Even one expired license or outdated CV can stall the entire application.
2. Incomplete CAQH Profile
Most commercial payers will not even start reviewing your file until CAQH is 100% complete and attested.
3. Slow Follow-Ups
Delays often happen because a payer requests more information and nobody responds quickly.
4. Incorrect Practice Address or Phone Number
This causes failed site visits and application rejections — especially with Medicare.
5. Not Tracking Renewal Dates
DEA, licenses, malpractice, and certifications must stay current.
Final Thoughts
Credentialing is often overwhelming, but it’s a critical part of running a successful medical practice. Knowing the requirements for Medicare, Medicaid, and commercial payers helps you plan ahead, avoid delays, and protect your revenue.
By staying organized, keeping documents up to date, and responding quickly to payer requests, you can complete the credentialing process smoothly — and start seeing patients without interruptions.
Related Links
Credentialing 101: What resident physicians need to know