When we talk about EDI, we understand it as a standardized electronic method to transmit business documents, especially for traders. EDI transactions are crafted as an independent mode of communication that can be used by companies or software technologies for sending and receiving information.
With the help of set EDI standards, companies can automate and streamline purchase orders, invoices, acknowledgments, payments, tracking, and other relevant reports.
A minimum amount of vital data is necessary for EDI document transactions. A certain amount of data also ensures EDI compliance requirements are met. Exercising strict EDI feed formatting rules defines each part of the data on the document precisely.
Every document is assigned dozens of transaction numbers from the public format. With efficient EDI integration, companies can improve the overall data transfer process between the internal and external systems, applications, and cloud ecosystems.
So, to summarize, every insurance document or government report, or even a text message – all action is backed by EDI processes and individual EDI transactions.
In this article, we will be talking about the 834 EDI transaction set and why you should invest in EDI to better the outcomes.
EDI – 834
An EDI 834 document was built especially for the company employees so that they can enroll in any healthcare insurance plan. 834 is a form that allows employees to safely and securely enroll in their preferred health benefits. This document type is HIPAA compliant and has proper standards for the electronic data exchange of even the most sensitive information.
What Information Holds EDI 834?
Typically, EDI 834 will include the information that is requisite for an employee to fill out the health insurance plan form.
- Subscriber Name
- Benefits Information
- Date of Birth
- Member Name
- Subscriber ID
- Plan Network ID
- Service ID
Use of 834 Form
The EDI 834 – Benefits enrollment and maintenance specifications are used between an employer, union, or government agency and insurance carrier provider. This form is used for the new enrollees, who want to make changes in the enrollment, reinstate the benefits enrollment or terminate the enrollment of the employee.
EDI 834 Standard Format
N3*123 SAMPLE RD
The exchange happens when the organization pays and organizes the benefits for its employees. Along with the healthcare document exchange, with an EDI integrated solution, companies can –
- View enrollment record as a form
- Read, browse, and parse 834 files
- Print and save enrollment records in PDF or TIFF format
- Export enrollments and benefits data to any database and as Excel files
- Create an 834 EDI file directly from the database
- Get HIPAA compliance checked
- Automate processing, manage 999’s, TA1, and more
- Codes can be translated into descriptions
Process & Advantages of 834
Any EDI system utilizing X12 834 benefit enrollment transaction communicates benefits. The system structures and matches the data elements in 834 transactions in order to provide a seamless exchange of benefits enrollment data.
Understanding the EDI Workflow Template for 834 File
An efficient EDI solution can convert all the complicated EDI files into pre-built solutions deterring major challenges.
- The EDI solution sorts all the 834 files based on members, subscribers, and dependents that are put in a configured order.
- The system then splits the files based on eligibility criteria or Enrolment type. For instance, if you want files to be classified based on classes or plan types, an effective EDI solution can split files or combine even the proprietary formats.
- Seamless EDI services come with a built-in API that allows custom enrichment rules and policies that check for the data processing as per established rules.
With an 834 transaction set, companies can eliminate the large & painful process of benefits enrollment as well as the challenge faced during the import and export of the data.
834 follows the industry-specific standards for data mapping and ensures that the data inputs are correct and in a proper format.
To be precise, with EDI 834 you can –
- Enhance the company’s operational efficiencies for HIPAA claims processing.
- Ensure the accuracy, security, and reliability of information exchanged between the healthcare organizations, payors, and clearinghouses.
- Improve the accuracy of information exchanged, and improve the quality of healthcare delivery and support process.
- Improve the data accuracy of information exchanged between the trading partners.
In order to process EDI transactions, you must follow proper EDI standards. Let’s understand the EDI Communication Standards.
What Consists of EDI Standards?
Any EDI transaction is a composition of the following parts –
Elements – Data elements are the smallest component as individual lines of information in EDI. For instance, purchase order or invoice will have elements in form of a city, state, cost, or item number.
Segments – A group of these elements is segmented. Every section in a document is described as a segment, like purchase order, street addresses, company name, etc.
Transaction Set – The collection of segments in a predetermined format makes up an EDI document or transaction set.
Any electronic data interchange depends on EDI standards as their main purpose is to minimize the complications in the communications and costs incurred due to data redundancies or chargebacks.
Organizations must analyze the best method to connect with their trading partners in order to send and receive information seamlessly. There is always a competition between EDI AS2 and VAN. Let’s read further to understand which is better for your business.
Applicability Statement 2 sends and receives information in any format (EDI, XML, or other) through HTTP protocol handled by a certified server. AS2 is considered secure, cost-effective, and the best way to integrate with trading partners.
AS2 can be deployed with the help of an in-house IT team or simply outsource to a cloud-based EDI vendor.
A value-added network offers a single connection to direct EDI transactions to the trading partner. Every trading partner using a VAN possesses data as a mailbox to deliver the data to each other.
VAN renders real-time tracking, communication management, multiple connectivity options, local data integration, and rapid message delivery. Despite VAN being a cost-effective solution, new & improved methods have taken place, offering end-to-end connectivity and solution to complex integration.
EDI Communication Standards
UN/EDIFACT – An internationally standardized communication guideline set for the exchange of data tags and message types, EDIFACT is for Administration, Commerce, and Transport industry. EDIFACT structures data into segments, segments are then formed into messages and messages into an interactive exchange protocol.
TRADACOMS – The chief EDI standard for domestic trading, TRADACOMS is built for the retail industry. Like the EDIFACT, TRADACOMS also uses multi messages instead of a single messaging format. There are 26 messages structured in a hierarchy, given in a six-letter application reference.
ODETTE – Most popular in Europe, ODETTE is created for seamless data exchange and communication in the automotive industry. ODETTE renders enhanced security for EDI data exchange through encryption and digital certification. With OFTP and OFTP2, companies can securely and efficiently communicate with various software and ensure successful data exchange.
ANSI X12 – A globally recognized EDI standard to communicate digital B2B transactions, ANSI ASC X12 allows consistency among business documents and other kinds of enterprise functionality. Almost all industries, such as healthcare, insurance, transportation, government, finance, and others, can use X12 as it offers more than 300 different types of X12 EDI standards.
In a Nutshell –
Following EDI standards is critical for employee benefits enrollment and maintaining processes. The wrong demographic data can negatively impact the membership plan and integration of the information.
In order to ensure a seamless and effortless EDI 834 transaction, it is better to find a third-party administrator. A provider or an administrator can program appropriate industry standards as per your niche while conforming to the needs and formats of all insurance carriers.
Author’s Bio: Scarlett works with the editorial team of A3logics, a leading company offering EDI Integration. Exploring the latest technologies, reading about them, and writing her views have always been her passion. She seeks new opportunities to express her opinions, explore technological advancements, and document the details. You can always find her enjoying books or articles about varied topics or jotting down her ideas in a notebook.