What is Healthcare EDI & Why is it Important?

Healthcare EDI has been a hot topic of discussion in the industry for a long time. Some of the experts in the field have shared that with the help of EDI, healthcare facilities have become more streamlined and organized than ever before. While there are a few orthodox users who are yet to witness the abilities that EDI in healthcare can bring to the table. People often consider Electronic data interchange to be a more supply chain-oriented software that enables crystal clear communication and transfer of documents among trade partners.

If we go by the textbook definition, EDI is a tool used to create effective data interchange channels between two entities in the business. What it means is instead of using a paper trail to track the steps in a supply chain or any sort of data exchange, the information is shared electronically with the help of computing devices. Documents such as purchase orders, invoices, etc. are the most common examples of things that can be transmitted electronically via EDI channels. 

Now, the above definition of EDI might have raised a few questions in your mind as to how is all that relevant to healthcare? Bills and prescriptions provided to the customer, or in the case of healthcare, patients are usually hard copies than how can EDI be implemented in healthcare? What importance does the EDI as a concept hold in healthcare? Well, there is surely a lot more use for EDI in healthcare, and in this post, you will learn everything about it. 

What is Healthcare EDI? An Overview of Implementation

For an individual who is not familiar with transactions that occur in healthcare, this might come as a surprise, but there is a lot more to deal with in a healthcare facility than just prescriptions and fees. You see, insurance is one of the core players in every healthcare-related transaction. Every facility has to create a clear communication channel between itself and the insurers that work parallel to their field of expertise. 

Healthcare EDI deals with creating a solid and secure communication channel between insurers, and healthcare providers to ensure that the patient’s data is safe, accurate, and verified instantly. Before the EDI, the industry had to struggle with high IT costs, poor efficiency, and misinterpretation of data sharing among healthcare providers and insurers which made the process slow and highly inefficient. 

With the help of Healthcare EDI implementation, not only these problems can be eradicated, but the entire process can be made efficient instantly. EDI and healthcare might seem two different worlds in the beginning. However, when you understand the applications, you can surely interpret that these have a lot more to work together. The security and accuracy of medical information are the utmost priority of every healthcare facility. These are confidential information that should stay between the doctors and patients.

However, when a patient decides to claim insurance for treatment, they have to share the information with their insurer, and hence the possibility of leaking the data arises. With the help of EDI, healthcare facilities stay in touch with the appropriate personnel responsible for claims and other things with the insurers through electronic communication. There are standardized file formats used in EDI to maintain an official record of transactions, which makes it more traceable and secure. Some of the core transactions that are carried out with the help of healthcare EDI are as follows – 

1. EDI 271 – Healthcare Benefit Response Transaction 
2. EDI 276 – Claim Status Request 
3. EDI 277 – Claim Status Notification
4. EDI 278 – Service Review 
5. EDI 837 – Claim Transaction Set  
6. EDI 835 – Claim Payment Transaction Set
7. EDI 834 – Benefits Maintenance & Enrollment Set
8. EDI 820 – Premium for Insurance Transaction Set 

With the help of these transaction sets, healthcare facilities can easily assist a patient in using their insurance benefits while maintaining the integrity of the data. All these are dedicated standardized files that are used to raise, deploy, or enquire about any request that is already in motion. 

How EDI Makes a Difference in Healthcare? Is it Important?

If you are wondering whether EDI is helpful and useful in healthcare then you should clear your mind about it with a yes. Electronic data interchange plays a crucial role in creating a hassle-free experience for both the patients as well as the experts of healthcare. It also provides clarity in the information that is transmitted from one source to another and since there is minimum human contact, the chances of making an error are significantly reduced. 

The Healthcare industry is not just any other business. If a single piece of information is misinterpreted, life can be in danger hence, there is no room for unnecessary delays and errors in the information. EDI makes it easy for healthcare experts to deal with the exchange of data and the best part is that all of it happens in real-time. There are no lags in EDI as it is a legacy setup system that is solely dedicated to receiving and sending the documents. 

When you opt for healthcare EDI and choose one of many professional EDI services, you make a decision that not only speeds up the process but also adds to the efficiency of the entire system that you have in place. All in all, you can say, without proper internal communication, the healthcare industry will be a complete mess and the mess can only be resolved by implementing EDI systems. The benefits of implementing an EDI system in a healthcare setting are listed below – 

1. Centralized & Standardized Communication 
2. Reduces Required Resources & Saves Administrative Cost
3. Makes the Data Interchange More Efficient and Accurate.
4. Speeds Up the Process by a Huge Margin
5. Keeps Integrity of Information Intact & Makes the Transaction Safe.

Due to these 5 benefits, the overall productivity of the healthcare industry is enhanced. Hence the results are always better in terms of assisting the patients and generating business. These benefits are also the reason why Healthcare EDI is important and must be implemented.

Final Words

Knowing the potential of what healthcare EDI is capable of and how it raises the quality of experience, you surely would have got a better understanding of its importance. EDI is the need of the hour for almost every other business and healthcare ranks at the top in those. If you are from the industry, you might be aware of how crucial data and information in healthcare are. 

With that being said, keep in mind that all these perks do depend on the type of assistance you get and the way EDI is implemented in your organization. There are multiple EDI solutions available in the market. However, not all of them are the best, and hence you have to be careful while making the decision. This brings us to the end of this post. Hope all your queries related to EDI in healthcare and if it is important or not are by now. Thanks for your time. Good luck!