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Most health plan leaders already know their credentialing process is slower and more expensive than it should be. What they typically haven't done is calculate the full cost across every dimension where it shows up, and that gap between knowing there's a problem and knowing its size is exactly where most credentialing improvement conversations stall. A vague sense of inefficiency rarely moves a budget. A specific number has a greater chance of prompting change.
What follows is a look at four dimensions of credentialing cost that most organizations have never formally measured, drawn from the frameworks in The Hidden Economics of Credentialing, a practitioner's guide co-authored with Joey Costa of Provider Peak. Each one is calculable with data your team already has.
The cost that hides in plain sight: Staffing
Credentialing teams know how many people they have. What most have never calculated is a formal cost per credential, and the reason that matters is that without it, you cannot evaluate alternatives, compare vendors, or build a legitimate ROI model around operational change.
The formula is straightforward: total staff hours spent on credentialing per month, multiplied by the burdened hourly rate, divided by the number of credentials processed. That number is your cost per credential, and for organizations running largely manual verification workflows, it is typically higher than anyone expects when it finally appears in a spreadsheet. The reason it stays hidden is structural: it lives inside headcount budgets rather than being attributed to credentialing output, so no one has ever had reason to calculate it.
Cost per credential = (monthly staff hours on credentialing × burdened hourly rate) ÷ credentials processed per month
Once you have the number, it becomes a basis for comparison. At that point you can model what a 30% reduction in manual hours per credential would mean at your current volume, evaluate what a CVO charges per file against your internal cost, and project what the same team could produce if automation handled the majority of primary source verifications. Organizations that have made that shift typically see cost per credential drop significantly, not because headcount is eliminated but because the same team processes substantially more volume with far less manual effort per file. The math is usually more compelling than expected, and it only becomes visible after someone calculates the baseline.
Related: 3 Questions to Ask Your Credentialing Operations Team When Preparing for Provider Network Growth
The cost that compounds every time you grow: CVO and vendor fees
Per-file CVO pricing does something that most other vendor relationships do not: it creates a direct link between network growth and cost with no efficiency gain from volume. Every new provider added to the network, every re-credentialing cycle, every expansion into behavioral health or a new geography generates another line on the invoice. Most CVO contracts also include annual rate escalators, which means the cost trajectory runs in one direction regardless of how well the organization performs.
The full cost of a CVO relationship is also broader than what appears on the invoice itself. Add the internal staff time required to manage the vendor relationship, chase down missing information, review completed packets, and handle exceptions, and the true cost of outsourcing credentialing is meaningfully higher than the per-file fee suggests. The formula that captures it more accurately is: per-file fee multiplied by annual re-credential volume, plus overages for complex cases, plus the hourly cost of internal staff time spent managing the relationship.
True CVO cost = (per-file fee × annual re-credential volume) + complex-case overages + internal staff hours managing the relationship
Excellus BCBS documented this dynamic directly. The organization inherited decades-old systems, manual workflows distributed across multiple teams, and fragmented provider data sources with no reliable reconciliation between them. Moving to an integrated, automated model produced a 98% reduction in credentialing turnaround time, seven-figure cost savings, and expanded monitoring coverage by 250%, not from headcount reduction alone, but from replacing a cost structure that scaled with volume with one that did not.
Watch on-demand: How Salesforce, Verifiable, and Excellus BCBS Are Scaling Provider Networks With Automation
The cost almost no organization has modeled: Fraud and claims exposure
There is a category of credentialing cost that most health plans have never formally calculated, and it is the one with the most direct financial liability: claims paid to providers whose status changed after credentialing but before the change was detected.
Providers who pass initial credentialing can still introduce financial and regulatory risk when credentialing is treated as a one-time qualification event rather than an ongoing compliance function. Federal and state programs require that payments made to excluded providers be returned. That means the liability is not speculative but calculable: it is the dollar value of claims processed during the window between when a provider's status changed and when that change was detected by your monitoring program.
For organizations running periodic monitoring on a monthly batch cycle, the exposure window can be up to 30 days per provider. At high encounter volumes, that exposure accumulates quickly across a network of any meaningful size. The formula the whitepaper recommends is risk-adjusted exposure per provider multiplied by the monitoring gap in days, and when organizations run it for the first time, the result tends to reframe monitoring from a compliance line item to a risk management function with real financial stakes attached.
Fraud/claims exposure = risk-adjusted exposure per provider × monitoring gap (in days)
Related: How Payers Maintain a High-Quality Provider Network With Proactive Monitoring
The cost credentialing teams don't own but directly cause: Star Ratings revenue
For Medicare Advantage plans, the connection between credentialing infrastructure and plan revenue is direct, quantifiable, and almost never part of a credentialing budget conversation, because the data lives in different departments and no one has drawn the line between them.
CAHPS access-to-care scores are a primary input to Star Ratings, and research on Medicare Advantage plan performance indicates that each Star Rating point represents an estimated $200 to $500 per member per year in quality bonus revenue. Directory inaccuracy is a documented driver of poor access-to-care scores: when a member calls a provider listed as in-network and finds that provider unavailable, no longer at that location, or not accepting new patients, the CAHPS survey captures that experience. And directory accuracy, in turn, depends on provider status changes propagating from the credentialing record to the directory in something close to real time.
Plans running two- to three-year re-credentialing cycles with manual reconciliation between systems carry a lag, and that lag is where the Star Rating exposure lives. It accumulates quietly in CAHPS scores before it ever appears in a compliance report, which is why credentialing infrastructure decisions made this year are likely to show up in plan revenue two or three years from now. Drawing that line explicitly, and putting a number to it based on current membership scale, is the kind of analysis that changes how a COO or CFO thinks about what a credentialing investment is actually worth.
Sandra Clarke, former COO and CFO of Blue Shield of California, framed it directly in a recent conversation on the Bright Spots in Healthcare podcast: slow credentialing stalls the provider network, which directly impacts member access, experience scores, and revenue tied to timely onboarding. The function is no longer a compliance chore. It is a strategic lever, and the organizations that treat it that way will have a structural advantage over those that don't.
Listen to the podcast: Inside Credentialing: Where AI Delivers Measurable ROI for Health Plans
Frequently asked questions about the cost of credentialing
How do you calculate cost per credential?
Divide your team’s total monthly credentialing hours by the number of credentials processed, then multiply by the burdened hourly rate. This provides a per-file number that most plans have never put on paper. Because credentialing spend usually sits inside general headcount budgets rather than being tracked on its own, the result is often higher than leadership expects the first time it’s calculated.
What does a CVO actually cost beyond the per-file fee?
More than the invoice suggests. On top of the per-file fee and volume, factor in overage charges for complex files plus the hours your staff spend chasing missing documentation, reviewing completed packets, and managing the vendor relationship itself. Plans that skip that internal-time piece tend to underestimate what outsourcing is truly costing them when they compare it to building credentialing capacity in-house.
How does credentialing affect Medicare Advantage Star Ratings revenue?
Indirectly, but measurably. A provider’s status can change in your credentialing system well before that change reaches the member-facing directly. In the gap, a member may call a listed provider who’s no longer there or no longer taking patients. This is the kind of experience CAHPS access-to-care surveys pick up on, and CAHPS feeds directly into Star Ratings, which carry real per-member quality bonus dollars. Because the lag builds quietly, a credentialing gap created today might not show up in revenue until a few Star Ratings cycles later.
Before any vendor conversation: calculate the baseline
The four cost dimensions above are worth calculating before any technology or vendor evaluation begins, because organizations that enter those conversations without a baseline cannot evaluate what they are actually buying and cannot demonstrate ROI after implementation.
The practitioner's guide co-authored with Joey Costa of Provider Peak includes a five-question credentialing maturity self-assessment your team can complete in about 15 minutes, scoring operations across verification completeness, monitoring frequency, data governance integrity, process auditability, and workforce leverage. It is designed to work with any vendor, any operational model, and any technology stack, because the goal is a better internal business case, not a specific solution.
Download The Hidden Economics of Credentialing: A Framework for Operational Redesign to access the full cost calculation framework, maturity assessment, decision matrix, and 90-day pilot structure. Or use Verifiable's ROI Calculator to estimate your cost per credential and potential savings from automation.
