For Providers & Billing Staff

Enrollment & Credentialing

Before you can bill a health plan for services to its members, your organization must be formally enrolled and credentialed. This process validates your license, tax ID, and provider identity, and ensures compliance with plan and regulatory requirements.

The Credentialing Process

Eligibility & Benefits Verification

Before you provide services, verify that the member is enrolled and confirm what benefits apply. This step prevents claim denials and ensures the member knows their cost-share obligations upfront.

Why Verification Matters

• Reduces claim denials — A "no coverage" or "membership inactive" denial after services are rendered is costly to collect.
• Transparency for the member — Telling a member their copay or coinsurance before you treat them builds trust and prevents billing surprises.
• Supports clean claims — Accurate coverage and benefit info enables you to bill with correct coding and modifiers on the first submission.

How to Verify

Most health plans offer eligibility and benefits verification via:

• Provider portal — Real-time eligibility lookup (often free) from the plan's website.
• Phone line — Call the plan's provider line with the member's ID; they read aloud coverage, copays, deductibles, and any prior-authorization requirements.
• EDI (837 query) — Automated eligibility request-and-response, typically used by larger billing departments.
• Clearinghouse services — Third-party vendors batch eligibility queries for multiple plans in one submission.

Medicare and Medicaid coverage can change on the first of each month, and many health plans change benefits annually, so verify close to the date of service—not weeks in advance.

Prior Authorization & Concurrent Review

Some services (surgeries, imaging, specialty drugs, high-cost procedures) require the plan's advance approval before they are covered. This is called prior authorization.

When Is Prior Authorization Required?

• Each health plan and state Medicaid program maintains its own prior-authorization list. There is no universal rule.
• You can find which services need authorization in the plan's provider manual, the benefits document the member receives, or (for most plans) via electronic lookup.
• For emergency or urgent services, some plans allow authorization after treatment, as long as it is requested within a defined window (e.g., 24 hours).

The Authorization Request Process

1. Submit the request — Use the plan's online portal, fax, or EDI (837i claim format). Include diagnosis, procedure code, clinical justification, and member ID.
2. Plan's clinical review — A nurse or physician reviewer checks the request against the plan's medical necessity criteria.
3. Decision — Approved, denied, or requested information. The plan must respond within 2–5 business days (rules vary by state and urgency).
4. Peer-to-peer review (if denied or contested) — You can request a conversation between your physician and the plan's physician reviewer to discuss the case.
5. Member notification — If denied, the plan notifies the member. The member has the right to appeal (see Your Rights). You have the right to appeal on your own if you believe the denial was improper.

A denial of authorization does NOT prevent you from delivering care; it means the plan will not cover it. You must inform the member in writing of the plan's denial so they can decide whether to proceed and pay out of pocket.

Claims Submission & Adjudication

A claim is your bill to the plan. The plan's adjudication process determines what it will pay based on benefit rules, coverage, and coding accuracy.

Clean Claims

A "clean claim" has complete, accurate, and compliant information and speeds payment. Common reasons for claim rejection:

• Missing or invalid NPI, member ID, or provider tax ID (TIN).
• Incorrect diagnosis or procedure code, or missing modifier (e.g., -LT for left, -RT for right).
• Billing before services were authorized, or after the timely-filing deadline.
• Duplicate claim (the plan has already received and paid this claim).
• Member not eligible on the date of service.
• Service not covered under the member's plan (e.g., no dental under Original Medicare).

Most plans accept claims electronically (via 837 file or EDI), which reduces errors and speeds processing. Paper claims are slower and discouraged. Always submit within your plan's timely-filing window—typically 30–90 days after the date of service.

Remittance Advice (ERA/EOB)

After the plan adjudicates your claim, it sends a remittance advice—either an electronic Explanation of Remittance (ERA, in 835 format) or a paper Explanation of Benefits (EOB). This document explains:

• Which services were paid, denied, or downcoded.
• How much was paid and how much (if any) you write off as patient cost-share or plan adjustments.
• The reason for any denial (non-covered, not medically necessary, out-of-network, timely-filing expired, etc.).

Corrected & Resubmitted Claims

If a claim was incorrectly coded, improperly denied, or missing information, you can resubmit it. Most plans require you to:

• Clearly identify it as a corrected/replacement claim (not a duplicate).
• Include the original claim number or date of service.
• Resubmit within the timely-filing window, or request an extension.

Appeals & Dispute Resolution

If a claim is denied or underpaid, you have the right to appeal. This is separate from a member's appeal of their coverage.

Provider Appeal Process

1. File an appeal with the plan — Submit within your plan's appeal window (usually 30–60 days from the denial) with written explanation of why you believe the denial was wrong.
2. First-level review — An independent reviewer (different from the original decision maker) reassesses the claim and may request additional clinical documentation or coding justification from you.
3. Plan's response — Typically within 30 days. If upheld, you can request a peer-to-peer call or escalate to a second-level appeal.
4. Second-level appeal (if available) — Some plans offer an additional appeal; external review may also be available for medical-necessity disputes.

Note: A provider appeal is independent of the member's right to appeal. Even if the plan upholds its denial to you, the member may file their own member appeal to challenge coverage.

Value-Based Care & Risk Arrangements

Beyond fee-for-service (FFS), some providers participate in value-based contracts where payment is tied to quality, cost control, or member outcomes.

Common Models

• Fee-for-Service (FFS) — You are paid per service (visit, procedure, test). Most common; plan bears most financial risk.
• Capitation — You receive a fixed monthly fee per patient, regardless of how many services you deliver. You bear some financial risk if costs exceed the capitated rate.
• Value-Based Arrangements — Payment adjusted based on quality metrics (e.g., preventive care rates, patient satisfaction, disease control), cost savings, or shared savings/losses.
• Accountable Care Organizations (ACOs) — Affiliated providers collectively manage a population's care and share savings if they reduce costs while maintaining or improving quality.

Star Ratings & Quality Measures

Medicare Advantage and some Medicaid plans are rated on a 1–5 star system based on quality metrics (preventive care, medication adherence, customer service, etc.). These ratings affect plan enrollment, bonuses, and member choice. Providers contribute data on preventive services, care coordination, and outcomes; review your plan's quality reporting requirements to ensure accurate submission.

Fraud, Waste & Abuse (FWA) / Compliance

Medicare, Medicaid, and health plans are required to detect and prevent false billing, unnecessary services, and other compliance violations. As a provider, you are expected to:

• Bill only for services rendered — Upcoding, unbundling, or billing for services not delivered are considered fraud.
• Verify beneficiary eligibility and entitlements — Ensure the member qualifies for the benefit you are billing.
• Report suspected fraud or abuse — You can report suspected false billing, waste, or abuse to the plan's fraud hotline or to the Office of Inspector General (OIG).
• Maintain compliance training — Some plans and state Medicaid programs require or encourage staff training on billing rules and compliance.

For more information on compliance and fraud prevention, see the OIG Fraud Prevention page and your plan's provider manual.

Provider Terms Glossary

Related Resources

For an overview of health plan operations and payment workflows from the payer side, see Health-Plan Operations.