Untangling Credentialing and Contracting for Behavioral Health Providers
The Right Tack Podcast, Episode 8
If you’ve ever found yourself tangled in the maze of insurance applications or wondering why getting paid takes forever (or never!), this episode of The Right Tack is for you.
In Episode 8, BreezyBilling Co-Founders Paul Jonas and Jim Jonas tackle one of the most confusing topics for behavioral health providers: the difference between credentialing and contracting (and why mixing up the two can cause serious billing and payment headaches!).
Credentialing: Your Professional Identity
Think of credentialing as your personal resume for insurance panels. It’s the process of proving to payers that you’re a legitimate, licensed professional — your LMFT, LPCC, LICSW, or LP credentials are verified, your license is in good standing, and you’re eligible to see clients under their plans.
Credentialing follows you as an individual provider, even if you switch practices or move. In most states, that process runs through CAQH or a state-specific credentialing portal like Minnesota’s MCC. Keeping your profile current, including your license, education, and liability insurance, is crucial to staying in-network and avoiding disruptions in payment.
Contracting: The Business Agreement
Contracting, on the other hand, is the business agreement between the insurance company and your practice. It sets your reimbursement rates, filing timelines, billing terms, and all the other “lawyerese” you find in business contracts. Where credentialing validates you, contracting defines your business relationship with the payer.
Failing to keep your contracts up to date (for example, when you change offices, add providers, or change a name) can result in claim denials or delayed payments, sometimes taking months to resolve.
As Paul explains in the episode, “Some of the hardest messes to unravel are the ones where someone rushes through this process without understanding the business side of running a private practice.”
A Few More Nuggets from the Episode
Payers can deny contracts based on geographic saturation, meaning they might say they already have enough therapists in your area.
Medicare has strict limits on who can bill under supervision, and supervisees generally cannot see Medicare or Medicare Advantage clients.
Regularly update your credentialing files (CAQH, MCC, etc.) and check those reminder emails. Letting your credentialing lapse could terminate a contract altogether.
Listen to the Full Conversation
Paul and Jim dive deeper into the practical steps for managing both processes, common pitfalls to avoid, and what to expect as the payer landscape continues to evolve.
🎧Tune in to Episode 8 of The Right Tack: “Credentialing and Contracting: What’s the Difference?”
Available now wherever you get your podcasts.
