Common Credentialing Hurdles: Transform Risk Into Reliability

Common Credentialing Hurdles: Transform Risk Into Reliability in Healthcare’s new Superconnected Age

April 16, 2021
The VectorCare Team

When it comes to medical credentialing, mistakes can be very costly. Medical errors are more common than ever before, prompting lawsuits and resulting in unnecessary health issues and even deaths. Hospitals, payers, and all types of healthcare organizations are more concerned than ever about their reputation – as a trustworthy institution, employing the best practitioners, and providing the best care possible. One way that this is accomplished is through credentialing – making sure that each person authorized to provide patient care has the proper training, experience, and education to perform those tasks.  Gathering all of this information and keeping it current is not an easy job, but one that is critical to the organization.  


A legal term known as respondeat superior when applied to medical care means that employers are responsible for the negligent acts or omissions of its employees (1).  In the case of contracted employees, such as physicians that work for a staffing group, or travel nurses, for example – this may still be the case.  The principle of “right of control” over the worker and the details and manner of the work performed comes into play, meaning that hospitals are responsible for each worker under their roof - whether employee or contract worker.  Cases of malpractice or negligence always vary in details, but one thing is for certain – these cases are costly, and proper credentialing and risk management can help prevent them from occurring.  

As medicine becomes increasingly digital – crossing borders and enabling practitioners to practice in new ways and new places, credentialing has become even more complicated and easier for items to “slip through the cracks”. Credentialing practices in some settings are still very manual, requiring credentialing departments to scrutinize and maintain extreme attention to detail. Both a heavier responsibility and more complicated tasks are leading healthcare organizations to look for better processes and credentialing solutions.

As medicine becomes increasingly digital – crossing borders and enabling practitioners to practice in new ways and new places, credentialing has become even more complicated and easier for items to “slip through the cracks”.

Negligent Credentialing

Negligent credentialing cases are on the rise, and they tend to come about as a result of a medical malpractice case.  If a patient suffers an adverse event and sues the medical provider, an investigation will take place into that provider’s credentials.  In the case of negligence, a missing piece of information can result in the hospital also being sued for corporate negligence.  Hospital bylaws usually provide for credentialing rules/practices and hospitals are bound by those.  Failure to maintain current records, missing information, non-renewals, and practicing outside of scope open up hospitals to major lawsuits, and even class actions.

Credentialing expert Carole Cairns, in a credentialing webinar with Becker’s Hospital Review and the American Medical Association, states that she has never seen as many negligent credentialing cases as she has today (2).  

Why is this?

  • Hospitals are employing or contracting with more physicians and mid-level practitioners
  • When a malpractice case occurs, there are limited dollars that attorneys can seek from the provider, but in big hospital systems, there are much larger amounts to be sought.

Cairns gives examples of landmark cases that have shaped the credentialing negligence landscape.  However, she also gives examples of cases that were successfully fought.  The difference?  Documentation.  To put it bluntly, she says hospitals need to “walk their talk” – by having updated bylaws, and credentialing that reflects those bylaws.  Hospitals must always do what they say they are doing and be able to produce that documentation quickly and accurately.

Some tips on “walking the talk”:

  • Follow the governance documents, and make sure they are current.
  • Make sure all documents – the privilege forms, applications, and reference letters are state of the art.  
  • Make sure leaders of the medical staff and governing body are educated about the process.

Common Credentialing Issues

If credentialing of providers is so important to avoid litigation and patient harm, why do hospitals sometimes find themselves facing liability problems?  Even with the best of intentions, credentialing a large staff is difficult.  Issues and challenges are rampant in the credentialing field, requiring staff to keep track of many details and constantly circle back for follow-up. Without the right tools and the right processes in place, unintentional failures are bound to occur.

Healthcare is operating in a digital world these days, and credentialing departments now have the same digital opportunities – finally catching up to the speed in which medicine is moving.  Let’s take a look at some of the most common (and costly!) pitfalls of credentialing processes, and how new digital solutions are transforming risk into reliability (3).  Some common challenges in the credentialing arena are:

Changing Requirements

Requirements can change on a national, corporate, or state level frequently. The National Committee for Quality Assurance (NCQA) has developed a set of standards that now inform the provider credentialing process.  Public reporting and payer requirements also dictate a level of scrutiny.  These requirements have added rigor to the process, and hospitals must adjust their bylaws and processes to reflect that.  These requirements have changed many times over the past 20 years, mostly becoming more stringent.  (3) Payers and other organizations that supply information to credentialing departments have their own standards for processing requests.  Sometimes these take time, and if not adhered to properly, then more delays are experienced.  Some states have additional credentialing requirements, above and beyond other states.  It is up to the organization to know and request those items.

Failure to keep files up to date

Providers must update their licenses and credentials regularly (every two years is common), according to the state requirements. Additionally, processes to capture changes in contact information must be in place. Attention to detail is key.

Incomplete provider applications

Providers get frustrated with the credentialing as well – it can be quite daunting.  Applications require large amounts of information, and any missing pieces may cause the application to be rejected.  

Looking Ahead

It is safe to say that the world of healthcare is not becoming less complicated.  As healthcare adds new care models and modalities to adapt to the needs of the current population, new credentialing challenges will arise.  Telemedicine allows practitioners to practice remotely, across state lines on digital platforms and for organizations (4).  It is possible for a doctor to live in one state, practice for a company based in another, and treat patients all over the country.  The credentialing specialists need to be very savvy with all of the rules and state compacts that apply to these situations, as well as have updated policies in place to reflect that.  

Another trend is the increase in home services, by both licensed and unlicensed personnel.  Each organization needs to decide which healthcare workers need to be credentialed, and at what level.  Most employers are trending towards a more stringent credentialing process to filter out workers with questionable past experiences, criminal records, or lack of sufficient training.  The risk of employing someone unqualified to work with vulnerable populations is simply too great to ignore.  Healthcare workers of all types will need to be more aware of these requirements and prepared to provide complete histories and source documents.  

Forward-looking organizations may wonder how their credentialing department can successfully prepare for even more layers of responsibility and demands on their time.

Preparation is Key

Modernize processes through cloud-based technology.

Organizations that are still relying on file cabinets and spreadsheets to track information will be at a major disadvantage in an increasingly complex environment.  Drowning in paperwork and struggling to organize it doesn’t have to be the reality.  Real-time data can now be automated, making provider verification across state lines more expedient, accurate, and secure.

With cloud-based software, practitioners can also readily share information, saving valuable time for emergency situations and preventing lost revenue (5).  

Develop compliant emergency onboarding policies and procedures.

If COVID-19 teaches us anything, it is how to ramp up healthcare capacity and processes quickly.  As emergency declarations were made across the country, many healthcare professionals wanted to travel to hotspots to give assistance.  In spite of the urgency, some level of credentialing is still required during healthcare disasters. Efficient credentialing departments definitely have their place in emergency response plans, and credentialing departments can utilize online tools to codify and quickly deploy new credentialing workflows.

Keeping up with the technologies of primary sources.

Faxing source documents is a thing of the past: if you are still hearing that familiar fax ring all day at your organization, it may be time to update.  Payers, academic institutions, governing bodies, state medical boards, insurance companies, etc. are moving to responding to requests on a digital platform, both for ease of use and record-keeping. (6) Sharing verified, secure, and accurate documents - as well as storing them - digitally has become the norm, rather than the exception.  Maintaining a system that takes advantage of all the available connectivity out there will be key to staying competitive in the future.

The credentialing goal is to obtain accurate, complete, properly sourced records for each person in the organization that has patient care responsibility, and to maintain those and update them regularly.  As the healthcare world moves faster than ever before, new challenges are presented -  like clinicians practicing in multiple states, telehealth expansion, and changing requirements from states, payers, and organizations.  New information and more credentialing tasks strain legacy systems’ ability to keep up, opening up gaps that can lead to negligence and litigation. Digital platforms provide the basis for organizing, storing, and updating all of the moving parts that comprise a successful credentialing program.  Digital tools are the right tools for the job, providing the data security, ease of use, and reliability that organizations need to meet future challenges.


Want to read more from the Patient Care Logistics Journal? Check out our latest podcast episode with Robert Thorn, the Director of Pinnacle Healthcare Consulting.

1.Thornton, R. (2010). Responsibility for the Acts of Others. Baylor University Medical Center Proceedings, 23(3), 313-315. doi: 10.1080/08998280.2010.11928641

2. Haefner, M. (2019). How hospital and physician leaders can prevent negligent credentialing lawsuits. Retrieved 16 April 2021, from

3.  Credentialing Issues in Healthcare . (2021). Retrieved 16 April 2021, from

4.  Patel, R., & Sharma, S. (2020). Credentialing. Statpearls Publishing. Retrieved from,continuously%20audited%20for%20their%20performance.

5. Industry Voices—Telemedicine's time to shine: Can credentialing keep up?. (2020). Retrieved 23 April 2021, from