Credentialing Guide for Multi-State Providers

Did you know that with multi-state credentialing, you become legally eligible to expand your practice across state lines?

But it is not an easy process given the varying state-specific requirements and regional-specific payer portals.

This guide will help you understand everything you need to know about it. We will cover its key requirements, best practices, and key challenges.

Thus, if you are looking to expand your patient base across several states, continue reading!

Requirements for Multi-State Credentialing & Licensing

To open a new physical location or expand your patient base through telehealth across multiple states, you must understand the essential requirements for multi-state provider credentialing.

So, here we go!

Medical Licensing Requirements

In every state where you wish to bill the insurance carriers for patient encounters, you must hold a valid license specific to that jurisdiction.

But how does it work? Each state has unique requirements regarding documentation, background checks, and fees.

The good news? 

• The Interstate Medical Licensure Compact (IMLC) allows you to obtain licenses in multiple participating states simultaneously using a single application.
• If you are a registered nurse (RN) or licensed practical nurse (LPN), you can apply for a multi-state license with the Nurse Licensure Compact (NLC). It gives you the privilege to practice in other compact states.

Note: You must track and meet the Continuing Medical Education (CME) requirements for every state where you hold an active license.

Insurance Credentialing Requirements

Let’s say you have an active license in every state you want to practice. But what is next? Can you start seeing patients covered by specific insurance carriers straight away? Definitely not!

Holding an active license is just a prerequisite for multi-state credentialing. That is, you must get credentialled with each payer you want to bill in each specific state. 

What do you need?

• Your National Provider Identifier (NPI) number is national, but you must ensure your taxonomy codes align with the services you plan on offering in each new state.
• Update your Council for Affordable Quality Healthcare (CAQH) profile to include all new state licences and practice locations.
• Your professional liability policy should cover practice in multiple states. Besides, in each state, you must meet the minimum coverage limits requirements.

Note: Do you want to see Medicaid beneficiaries as well? If yes, you must enroll in each state’s specific Medicaid program separately.

Regulatory & Compliance Requirements

You must also fulfill the following regulatory and compliance requirements for multi-state provider credentialing:

• Are you prescribing controlled substances? If yes, then you may need a separate DEA registration for each state or at least an update to your existing registration to reflect multi-state authority.
• What happens when you do not have a physical office in every state you conduct telehealth visits in? Some states may require a specific telehealth provider registration.

Note: Insurance payers will verify your education, training, and work history directly with the original institutions for every new state application.

Best Practices for Multi-State Provider Credentialing

The following are some of the best practices to help you streamline multi-state provider credentialing:

Centralize Your Primary Source Data

Yes, you need separate active licenses to get credentialed with each payer in every state, but the required documents stay the same for multi-state credentialing.

Thus, you should first create a digital folder in a centralized, secure location accessible to your credentialing team. Then store high-resolution, current copies of all credentials. 

Additionally, your CAQH ProView profile acts as the primary repository for multi-state data. Therefore, you must re-attest it every 120 days proactively. Besides, do not forget to add every new license as soon as it is issued.

Synchronize Licensing & Enrollment

Are you waiting for your state license to arrive before starting the insurance enrollment process? This is a disaster in the making!

Parallel processing is key to a seamless multi-state credentialing process. Even though you cannot submit a final insurance application without a license number, you can still start gathering the documents needed to meet the state-specific payer requirements. Besides, try to prepare the application in advance since credentialing is already extremely time-consuming.

Also, leverage NLC or IMLC wherever possible to expedite the licensing phase.

Leverage an Expiration Tracking System

Undoubtedly, tracking one set of expiration dates is difficult. Multi-state credentialing means you have to track five or ten sets of expiration dates. 

Here’s how you can rise above this hurdle:

• Set automated alerts for 60, 90, and 180 days before any document expires.
• Every state has different CME requirements and renewal cycles. Thus, integrate a tracking tool that categorizes credits by state-specific mandates.

Validate DEA & Malpractice Alignment

Administrative errors can trigger instant claim denials if they do not match across state lines. 

For example, if you are prescribing controlled substances, your DEA registration must reflect your authority to prescribe in each specific state. Besides, some states require a separate state-controlled substance registration (CSR) in addition to the federal DEA.

Moreover, you must ensure that your professional liability insurance includes ‘riders’ for every state where you practice. For context, a rider is an add-on provision to an insurance policy.

Conduct Regular Internal Audits

Perform quarterly internal audits of your provider roster to ensure all taxonomy codes, NPIs, and practice addresses are consistent across all payer databases and states.

Challenges in Multi-State Credentialing

Listed below are some of the key challenges you may encounter in your journey to multi-state credentialing:

• Each state medical board operates based on its unique rules and timelines. For example, one state may process a licence in 3 weeks, while another may take 6 months.
• Keeping track of state-specific CME requirements becomes a major administrative burden as you add more states.
• Targeted payers in every state must independently verify your medical school, residency, and previous employment with the primary sources. This leads to slow and repetitive communication with those external bodies.
• Insurance payers often have different enrollment portals and provider relations teams for different regions. As a result, you must submit separate applications and perform follow-ups. This consumes significant staff time.
• That’s not all, you must enroll in each state’s specific Medicaid program individually since Medicaid is state-run.
• Missing deadlines for renewal of DEA registration, licenses, or board certification is a major risk. The outcome? Immediate termination of payer contracts.
• Failure to update your CAQH profile with a new state license or malpractice rider will lead to an automatic rejection of the credentialing application.
• Licensing fees, background check fees, and credentialing service fees can quickly add up to thousands of dollars per provider when expanding across multiple states.
• Multi-state credentialing often requires a dedicated team. Besides, it costs approximately $33,000 to $50,000 to hire an in-house credentialing specialist. The alternative? You can outsource it to a specialized external partner, like MediBillMD.
• Many states require a separate state-level registration to prescribe controlled substances in addition to a federal DEA license.
• You must update the professional liability insurance to cover every state where you practice. In case the policy limits do not meet a specific state’s minimum requirements, your application will be denied.

Streamline Multi-State Credentialing With MediBillMD

With that said, it is time to conclude this comprehensive guide. Undoubtedly, multi-state credentialing comes with many challenges. However, if you implement the best practices we discussed in this guide, you can easily rise above the complexities.In case you want to partner with professionals, feel free to outsource insurance credentialing services to MediBillMD. What sets us apart from other credentialing experts? We leverage centralized project management tools, assign you a dedicated account manager, and share bi-weekly updates.