Delegated Credentialing: What It Is, How It Works, and Why It Matters

Delegated credentialing is a formal process in which a health plan or payer gives a provider group, MSO, or delegated entity the authority to credential its own clinicians using NCQA-aligned standards. Instead of submitting every provider for manual review, organizations with mature credentialing operations can take on the responsibility themselves — reducing timelines, lowering administrative load, and improving network expansion. This guide breaks down what delegated credentialing is, how it works, the compliance requirements involved, and what it takes to qualify.

On average, it can take payers anywhere from three to six months to complete the credentialing process. During that time, your providers aren’t considered in-network, so they can’t see new patients and get reimbursed for rendered services. That means you’re not only missing countless revenue opportunities, you’re unable to deliver life-changing care.

Fortunately, eligible health organizations can credential their own providers on the payers’ behalf, reducing both enrollment time and opportunity costs. This is made possible through delegated credentialing.

For digital health companies and other health systems, delegated credentialing is one of the best ways to support your growing provider network, drive operational efficiency, and generate additional revenue. Find out what it is and how it benefits you.

What Is Delegated Credentialing?

Delegated credentialing is a contractual agreement in which a payer authorizes a provider group, health system, IPA, or MSO to perform credentialing activities on its behalf. The delegated entity must maintain credentialing operations that meet NCQA standards — including primary source verification, sanctions monitoring, credentialing committee oversight, file audits, and recredentialing cycles.

When a payer delegates this responsibility, it shifts the operational burden while maintaining oversight through delegation agreements, performance reviews, and periodic audits. Delegated credentialing can significantly accelerate provider onboarding, but only if the delegated organization has the infrastructure to meet regulatory expectations.

How Delegated Credentialing Works

Delegated credentialing can target many different parts of the credentialing process, but it typically involves steps that rely heavily on manual tasks and that are particularly prone to delay—like primary source verifications (PSV).

Organizations can choose to delegate these functions in one of two ways:

• In-house. Establish or expand an internal credentialing committee to tend to primary source verifications and other critical credentialing tasks.
• Through a CVO. Partner with an external credentials verification organization (CVO) — preferably one that is fully automated and NCQA-accredited — to outsource PSV and other administrative needs related to the credentialing process.

If you decide to use an in-house solution, the efficiency of the credentialing process will largely depend on the efficiency and skill of your team. If your committee members have other full-time responsibilities to juggle, you may need to hire additional support to ensure credentialing can be carried out quickly and smoothly.

Keep in mind, if your team uses manual methods—like writing to or calling primary-source institutions to verify a provider’s credentials—this will hold up the process, largely negating the time benefits that made you consider delegated credentialing in the first place.

Benefits of Delegated Credentialing

When carried out effectively, the most significant benefits of delegated credentialing can be broken down into four categories: time, cost, administrative relief, and a better provider and patient experience. Let’s dive further into the specifics of each:

1. Time

As mentioned, credentialing providers through a payer can take as long as 6 months, during which time that provider cannot see new patients, deliver treatment, or be reimbursed for care.

Handling credentialing yourself gives you greater control. You can optimize the process, introduce more efficient workflows, and get your providers in-network faster.

When you partner with an expert CVO like CertifyOS, you can automate your credentialing workflows from end-to-end, completing primary source verifications in minutes and credentialing your providers in a matter of days.

2. Cost

The U.S. healthcare industry wastes upwards of $2.1 billion on inefficient, redundant administrative tasks aimed at verifying and managing provider data. This includes credentialing, which can run your organization between $500 and $1,400 per application.

By taking over and streamlining the credentialing process, you can cut back on needless spending and save considerably on costs.

This doesn’t even account for the additional revenue you stand to gain by allowing your providers to treat new patients sooner. Providers forfeit an estimated $9,000 each day their credentialing is delayed. That means a mere 30-day credentialing delay can cost your organization over $200,000 per provider—or over $10 million annually if you average 50 or so new hires a year.

3. Reduced workloads

Faster credentialing turnaround times and fewer back-and-forths with payers to exchange data and documentation means less paperwork and less of an administrative burden for your team, your partners, and your providers.

If you choose to work with a third-party CVO like CertifyOS, you’ll also benefit from having a single source of truth to store and manage your provider data in real time, so you can ensure the information you’re working with is always accurate and up-to-date.

4. Better experience

Simply put, less time, cost, and work requirements mean a better experience for everyone, from your internal team members and providers to your external partners and patients.

Delays in credentialing can lead to growing frustrations for providers who are anxious to provide services, care for patients, and get reimbursed to generate revenue as quickly as possible. Delegated credentialing can improve their job satisfaction as well as the satisfaction of their patients, who don’t have to experience extended wait times to receive in-network care.

Delegated Credentialing Requirements (NCQA-Aligned)

Delegated credentialing isn’t a casual handoff—it’s a regulated arrangement that requires the delegated organization to meet the same credentialing quality standards as a health plan. Most payers use NCQA’s Credentialing and Delegation standards as the benchmark for eligibility.

Below are the core requirements a delegated entity must demonstrate:

• Primary Source Verification (PSV). You must validate provider credentials directly with the primary source for required elements such as licensure, DEA certification, board certification, education and training, malpractice history, and work history.
• Credentialing Committee Oversight. A credentialing committee—staffed by clinical peers—must review files, approve providers, and document decisions in accordance with NCQA’s policies.
• Sanctions and Exclusions Monitoring. Delegated entities must continuously monitor OIG, SAM, state licensing boards, NPDB, and other datasets for disciplinary actions, exclusions, or sanctions.
• Recredentialing Every 2–3 Years. A structured recredentialing cycle must be documented and consistently followed to remain in alignment with NCQA requirements.
• Ongoing Monitoring. Organizations must track and act on changes to licensure, certifications, sanctions, and disciplinary actions in real time.
• Formal Delegation Agreement. The payer and delegated entity must execute a contract outlining responsibilities, oversight rights, audit requirements, reporting obligations, and corrective action expectations.
• Audit Readiness. Delegated entities must maintain credentialing files and documentation that demonstrate policy adherence and operational consistency. Annual audits by the payer are mandatory.
• Performance Reporting. Regular reporting to the payer — typically quarterly or semi-annual — validates that the delegated entity is meeting turnaround times, error thresholds, and quality metrics.

Meeting these requirements ensures regulatory credibility and significantly increases your likelihood of receiving delegation from major payers.

Delegated Credentialing Workflow (Step-by-Step Guide)

The delegated credentialing process follows a well-defined sequence. Here’s how organizations typically move from evaluation to fully delegated status.

Step 1: Assess Internal Credentialing Readiness

Evaluate whether your organization has the staffing, PSV tools, credentialing committee structure, and NCQA-aligned processes required for delegation.

Step 2: Engage Payers and Request Delegation

Most organizations start with their highest-volume payers. The payer will conduct a pre-delegation assessment to validate operational maturity.

Step 3: Negotiate the Delegation Agreement

This contract defines roles, responsibilities, turnaround times, reporting obligations, oversight rights, and audit expectations.

Step 4: Configure Credentialing Operations

Implement standardized workflows for PSV, committee review, sanctions monitoring, file completeness, recredentialing, and documentation.

Step 5: Complete the Initial File Audit

Before delegation is granted, the payer conducts a file audit — often reviewing 5–30 provider files — to ensure compliance with NCQA standards.

Step 6: Begin Delegated Operations

Once approved, your organization begins credentialing providers on the payer’s behalf. The payer will monitor performance through reporting and ongoing communication.

Step 7: Participate in Annual Audits and Reviews

Delegation isn’t permanent; continued adherence to standards is required to maintain delegated status. Expect yearly audits and periodic performance assessments.

This framework helps organizations understand the path to secure and maintain delegation with major payers.

Third-Party CVO Support

Digital health companies and other health systems can turn to expert third-party CVOs and other credentialing solutions to help with the delegated credentialing process.

Among other advantages, these partners can help you:

• Reach the group enrollment threshold that triggers delegated credentialing eligibility
• Ease administrative burdens, especially when it comes to time-consuming tasks like PSV
• Ensure effortless compliance throughout the credentialing process
• Consult on enrollment negotiations, contracts, reimbursement rates, and key policies and procedures
• Streamline NCQA survey preparations and (in the case of a fully NCQA-certified partner) provide automatic credit toward certain must-pass file review and non-file review elements

To maximize these benefits, we recommend looking for a CVO and/or enrollment solution that not only offers delegated credentialing support but a fully automated provider data platform that ensures efficiency and savings across the board.

How CertifyOS Can Help

In addition to hands-on delegated credentialing support, CertifyOS offers an industry-leading provider intelligence platform. Our API-first, automated data infrastructure can connect to hundreds of primary sources in real time and deliver thousands of verified provider data points in a matter of seconds—so you can get providers in-network and reimbursed for services faster.

Our superior provider data powers everything from one-click credentialing solutions to auto-filled, integrated enrollment applications, abstracting away the administrative details that hold you back from your full scaling potential.

Frequently Asked Questions (FAQ)

What is delegated credentialing?

Delegated credentialing is when a payer authorizes a qualified provider group, MSO, or health system to credential its own clinicians using NCQA-aligned standards. The delegated entity performs the credentialing work, while the payer retains oversight through audits and reporting.

Who qualifies for delegated credentialing?

Organizations that qualify typically have established credentialing infrastructure, NCQA-aligned policies, dedicated credentialing staff, a credentialing committee, reliable PSV tools, and the ability to maintain file completeness and documentation. Payers evaluate operational maturity before granting delegation.

What are NCQA’s requirements for delegation?

NCQA requires primary source verification, credentialing committee oversight, sanctions monitoring, ongoing monitoring of licensure and disciplinary actions, structured recredentialing, annual audits, and a formal delegation agreement. These standards ensure that delegated entities maintain the same quality level as the payer.

How is delegated credentialing different from traditional credentialing?

With traditional credentialing, the payer performs the credentialing steps independently for each provider. With delegated credentialing, the payer shifts that responsibility to a qualified provider group or MSO, reducing turnaround times and duplicative workflows while maintaining oversight through audits and reporting.

What are the benefits for provider groups?

Delegated credentialing can dramatically reduce provider onboarding timelines, improve operational efficiency, reduce back-and-forth requests from payers, support faster network expansion, and give organizations greater visibility into credentialing status across their provider base.

How long does it take to become delegated?

Timelines vary, but most organizations require 3–9 months to complete operational readiness assessments, negotiate delegation agreements, and pass initial file audits. Larger, more complex organizations may take longer.

What is a delegation agreement?

A delegation agreement is a formal contract between the payer and delegated entity. It outlines the credentialing responsibilities, reporting requirements, audit schedule, corrective actions, oversight rights, and service-level expectations. It is required for all delegated arrangements.

Do delegated organizations still undergo audits?

Yes. Annual audits are mandatory and verify that credentialing files, PSV processes, committee documentation, and recredentialing cycles remain compliant. Failure to meet standards can result in corrective action—or removal of delegated status.

To learn how they work, get in touch with our team at sales@certifyos.com—or request a live demo to see our platform in action.