Quarterly Compliance Article: Credentialing and Privileging of Contracted Providers

Health centers are legally responsible to ensure the clinical staff delivering patient care are credentialed, privileged and competent to provide care. The process of credentialing and privileging is one of the many ways health centers ensure the delivery of quality health care, promote patient safety and mitigate the level of risk taken on by the health center.  The credentialing process assesses and confirms the license or certification, education, training, and other qualifications of a clinical staff member, while the privileging process authorizes a clinical staff member’s specific scope and content of patient care services.  The credentialing and privileging process or the granting of temporary privileges must be complete before clinical staff members can provide care.  As a result, health centers must have a solid process in place for the process of credentialing and privileging. 

According to the Health Resources and Services Administration (HRSA) Health Center Program Compliance Manual, Chapter 5 – Clinical Staffing (Chapter 5: Clinical Staffing – Compliance Manual), the health center must have operating procedures for the initial and recurring review of credentials and the initial granting and renewal of privileges for all clinical staff members who are health center employees, individual contractors or volunteers.  In order to ensure appropriate access to care for patients, many health centers contract with individual providers or provider groups. 

So who is responsible for the credentialing and privileging of contracted providers? The answer to this question depends on the contractual arrangements made with the health center.   

  • Individual 1099 Contracted Providers – If the health center contracts with an individual provider who is paid through a 1099, the health center is responsible for the credentialing and privileging of this individual.  The services provided by this individual would be reflected in Column II on Form 5A and the provider would be eligible for FTCA coverage.
  • Contracted Provider Group – If the health center contracts or maintains formal written referral arrangements with a provider group, the health center has the option to credential and privilege these individuals, or allow the provider group to assume the responsibility.  In most cases, the provider group will perform credentialing and privileging, although the contract and/or formal written referral arrangement must contain verbiage that ensures the following:
    • Individuals in the provider group are licensed, certified or registered as verified through a credentialing process, in accordance with applicable Federal, state and local laws; and
    • Competent and fit to perform the contracted or referred services, as assessed through a privileging process.

In lieu of language in the contract of formal, written referral arrangement, the provider group may also demonstrate compliance with credentialing and privileging requirements by ensuring the health center has reviewed the following:

  • The provider group’s credentialing and privileging process
  • The provider group’s documentation from a nationally recognized accreditation organization

If the health center pays the provider group, the services would be reflected in Column II on Form 5A.  If the health center does not pay the provider group and services are provided through a formal, written referral arrangement, the services would be reflected in Column III on Form 5A.  In both cases, the individuals in the provider group would not be eligible for FTCA coverage.

To ensure continuous compliance, health centers should audit individual provider contracts, as well as contracts and formal, written referral arrangements with provider groups.  A self-evaluation of compliance can be completed by answering the questions under Element f in the Clinical Staffing Section (Clinical Staffing – Site Visit Protocol) of the HRSA Site Visit Protocol.

Have a question?