Effective Date

The date on which a provider's enrollment or network participation becomes active, allowing them to begin billing a payer for services.

The effective date is arguably the most financially important date in the entire credentialing process. It determines when you can start billing a payer. Any services you provide before your effective date will not be covered, and you eat the cost. Effective date policies vary wildly between payers, and this is where providers lose the most money during enrollment. Some payers set the effective date as the date the credentialing committee approves your application. Others backdate it to the date you submitted the application. Some set it as the first of the month following approval. A few use the date the contract was signed. Medicare has a specific effective date policy: your effective date is the later of the date you submitted your enrollment application or the date you first began seeing patients at the enrolled location. Medicare also allows retroactive billing up to 30 days before the effective date in certain circumstances. For commercial payers, the effective date is usually specified in your participation agreement. Read this section carefully. If Aetna tells you your effective date is the first of the month following committee approval, and the committee approves you on March 2, your effective date is April 1. Any patients you saw in March cannot be billed to Aetna. This is why starting the credentialing process as early as possible matters so much. Every day between when you start seeing patients and when your payer enrollment goes live is revenue you cannot bill for. A three-month credentialing delay with 15 patients per day at $150 per visit is over $200,000 in lost revenue. Pro tip: when you are negotiating your contract with a payer, ask if they will backdate the effective date to the application submission date. Some payers will, but you have to ask. It does not happen automatically.