Ask the expert: Revenue loss from credentialing delays

Q: More than half of hospitals report revenue loss tied to credentialing delays. Where are those losses typically occurring?

Rahul Shivkumar, co-founder of Assured Health: Credentialing completion is the midpoint, not the finish line. That is the single most important thing to understand about where revenue is lost. A provider can be clinically ready, fully hired, and internally credentialed, but still not generate a single billable claim until payer enrollment is active.

When that enrollment process stretches 60, 90, or 120 days, the organization is carrying full payroll cost on a provider who cannot bill. That is the most visible layer of loss, and it is consistently underestimated.

What makes it worse is that delays compound invisibly. An incomplete application comes back for corrections. Provider information changes between submission and approval. A malpractice document expires midstream and restarts the payer review clock. Each of those events adds weeks.

Hospitals measure submission date and see a clean timeline. They do not see that the application was rejected on day 14, resubmitted on day 31, kicked back again on day 47, and finally approved on day 94. The gap between those two measurements is where the revenue loss actually lives, and most finance teams have never looked at it that way.

Q: For credentialing leaders trying to make the business case internally, how can they best connect provider data delays to financial performance in a way executives understand?

Shivkumar: Stop presenting it as a process problem. Executives hear that word and assume administrative friction.

The conversation changes the moment you translate it into the following three numbers:

• How many days elapsed between a provider's signed start date and their first billable claim
• How many of those days were attributable to credentialing or payer enrollment
• The average daily reimbursement opportunity during that gap

Put those three numbers on a slide for any recent cohort of hires, and the issue stops sounding like backlog and starts sounding like deferred revenue with a specific dollar figure attached to it.

When a credentialing leader can say that a rejected enrollment packet or a 30-day lapse in payer follow-up extends revenue realization by one full billing cycle, that is no longer an operations conversation. That is a finance conversation. And finance conversations get resources that operations conversations rarely do. The credentialing function has always had the data to make this argument. Most teams have simply never been asked to frame it this way.

Editor’s note: This Q&A was excerpted from our Medical Staff Briefing newsletter.