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Do you have a group or individual contract?

Why does it matter?

Contracting with an insurance company can be confusing, especially since each insurance company and each state has its standards and procedures for credentialing and contracting. 

Contracts are particular and generally include the following.

- Which providers will provide services to the patients

- Where the provider will provide services

- How will the provider bill the claims to the insurance company? Through tax ID or SSN. 

- A list of the plans the provider (the Clinic or the individual) is in-network with.

Some insurances offer group contracts, and some only provide individual agreements. Credentialing specialists must ask their clients which type of contract they seek. If you are the client, specify your desired contract with your credentialing specialist. 

You'll be notified and awarded a separate contract if you request a group contract and the insurance company only offers individual contracts. If you ask for an individual contract, then that's what you'll be granted unless the insurance company auto-offers group contracts. 

A group contract is when the Clinic's type 2 NPI and Tax ID are on the contract. Once established, the Clinic can list individual providers on a roster. Once those individuals are credentialed with the insurance, they will be contracted under the group contract. Even if individual providers leave the Clinic, the group contract will stay. It's important to note that even with group contracts, you must still list the rendering individual on the claim.

An individual contract is when the provider's NPI and the Clinic's Tax ID are used for credentialing. If the provider leaves the Clinic, the contract is void and useless to the Clinic and the individual. A new contract will be needed with another provider for the Clinic, and the individual who left will need credentialing wherever they go next.

A common misconception about contracting is that once an individual provider is credentialed with an insurance company, that contract will work wherever they go. This thinking is incorrect because when a provider is contracted, it is connected to the provider's SSN or tax ID. The contract also specifies that the provider will provide services at a specific clinic address. A provider can be in the network with an insurance company but is credentialed under a particular tax ID or SSN. Some insurance companies need a demographic update to change the tax ID and address so the provider can work at a new clinic. Some insurance companies require a new application per tax ID/SSN. 

If you are hiring a new provider or a provider going to a new clinic, ensure you are credentialed with the correct tax ID/SSN to avoid billing and reimbursement issues. 

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