Private Practice 101: Should You Handle Billing & Credentialing Yourself or Hire a Professional?

Starting a private practice as a therapist means wearing many hats. Beyond seeing clients, you need to manage insurance billing, navigate credentialing, track payments, and ensure compliance with insurance providers. One of the biggest decisions you’ll face is whether to handle billing and credentialing yourself or hire a professional.

For some therapists, managing billing and credentialing in-house makes sense—especially when first starting out. However, the administrative burden can quickly become overwhelming, leading to lost revenue, claim denials, and delayed credentialing approvals.

So how do you know which option is right for your practice? In this guide, we’ll break down the pros and cons of DIY vs. professional billing and credentialing, the impact on your time and income, and how to make the best decision for your practice’s long-term success.

What’s Involved in Billing & Credentialing?

Billing Services Include:

• Submitting insurance claims for client sessions

• Tracking payments & denials to ensure reimbursement

• Correcting rejected claims and resubmitting for approval

• Following up on unpaid claims with insurance companies

• Managing client payments & outstanding balances

Credentialing Services Include:

• Completing insurance panel applications

• Maintaining CAQH & NPI enrollment

• Managing re-credentialing deadlines

• Negotiating reimbursement rates

• Handling provider contracts & compliance

Both are time-consuming, complex processes that require attention to detail and ongoing management. A mistake in billing or credentialing can lead to lost revenue and months-long delays in being able to accept insurance.

Option 1: Handling Billing & Credentialing Yourself

Some therapists prefer to manage their own billing and credentialing, particularly when starting out. Doing it yourself means having full control over the process and potentially saving money by not paying a professional. However, it also comes with risks.

Pros of DIY Billing & Credentialing

• Lower upfront costs – No need to pay a professional.

• Complete control – You oversee every claim and credentialing application.

• Learn the process firsthand – Understanding insurance requirements can help long-term.

Cons of DIY Billing & Credentialing

• Time-consuming – Managing claims, appeals, and credentialing applications takes hours every week.

• High risk of errors – A mistake in billing or credentialing can lead to denied claims, payment delays, and panel rejections.

• Longer credentialing timelines – If forms are incomplete or incorrect, insurance panels may take months longer to approve you.

• Frustration with insurance companies – Many therapists find dealing with insurance stressful and confusing.

Who Should Consider DIY?

• New therapists with a small caseload

• Providers who want full control over their financials

• Therapists comfortable with admin work & insurance navigation

If you choose to DIY billing & credentialing, investing in an Electronic Health Record (EHR) system like SimplePractice or TherapyNotes can help automate parts of the process.

Option 2: Hiring a Billing & Credentialing Professional

Many therapists choose to outsource their billing and credentialing to professionals who specialize in insurance management. While this requires an investment, it often pays for itself by reducing claim denials, improving cash flow, and speeding up credentialing approvals.

Pros of Hiring a Billing & Credentialing Specialist

• Saves time – Focus on clients while an expert handles admin work.

• Higher claim approval rates – Specialists submit clean claims that reduce denials and rejections.

• Faster credentialing approvals – Professionals know how to complete applications correctly to prevent delays.

• Better reimbursement rates – A professional can negotiate higher payments from insurance panels.

• Less stress – You don’t have to deal with insurance companies directly.

Cons of Hiring a Billing & Credentialing Professional

• Costs money – Most billing services charge 5–8% of collected revenue or a flat monthly fee.

• Less direct oversight – While professionals provide reports, you won’t personally handle each claim.

Who Should Consider Hiring a Professional?

• Therapists with a growing caseload who want to focus on clients

• Group practices that need scalable, efficient billing solutions

• Providers who want faster credentialing approvals

• Therapists who struggle with insurance paperwork and denials

Outsourcing is especially valuable for therapists who want to grow their practice without drowning in administrative work.

Cost Breakdown: DIY vs. Outsourcing

Service	DIY Cost	Outsourced Cost
Billing	Time cost: ~5-10 hours per week	5-8% of revenue OR $200-$500/month
Credentialing	Free, but time-intensive (~90-180 days for approval)	$150-$500 per panel
Claim Appeals	Time cost: Can take weeks to correct & resubmit	Handled by professional, reducing lost revenue

While DIY appears cheaper upfront, errors and lost time can cost you thousands in unpaid claims and delays.

How to Decide: Should You DIY or Hire a Pro?

Ask yourself:

1. How much time can I realistically spend on billing & credentialing?→ If it takes more than 5-10 hours per week, consider outsourcing.

2. Do I know how to handle insurance claims & provider enrollment?→ If not, a specialist can ensure accuracy and prevent costly mistakes.

3. Can I afford to lose money due to errors & delayed credentialing?→ If not, hiring a professional can maximize revenue and cash flow.

4. Do I want to deal with insurance companies?→ If not, outsourcing eliminates the frustration of dealing with insurance payers.

Final Thoughts: Which Option is Right for You?

Managing billing and credentialing yourself may seem cost-effective at first, but the time, errors, and lost revenue can make it more expensive in the long run. For many therapists, outsourcing ensures:

• Faster insurance reimbursements

• Higher credentialing approval rates

• Less stress & more focus on client care

If you’re considering outsourcing, our team specializes in helping Virginia-based therapists with billing, credentialing, and revenue management so you can focus on growing your practice.

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