835 EDI Transaction

835 EDI Transaction Reconciliation process description

835 EDI Transaction is an important transaction type in electronic documents exchange. Today EDI speeds and simplifies many transactions. Then there’s the world of healthcare remittance advice. The systems, standards and processes currently in place at healthcare payers’ companies are so profoundly behind those of other industries. Depending on the provider, payers will send combinations of paper and/or electronic remittances (EDI 835 documnet) and payments. For example, a provider might receive paper EOBs with an ACH payment or 835 EDI Transaction with a check. The forms of the remittances and payments are really up to the payer and their preferred method of interaction with each provider.

In most cases the reconciliation is quite straight forward. The provider of service billed for a specific amount and the payer paid the claim. An important element to consider is that the 835 requires both line balancing and claim balancing. Within these items any adjustments or modifications to the amount paid and the amount billed must have an adjustment reason code to explain any differences in the amount paid. This could most likely be caused by items such as deductable, co-insurance, procedure payment limits and co-pay. Another aspect of the reconciliation is that the provider of service must be able to address the items of bundling, splitting and the fact that 835 EDI Transaction may only pay a portion of the submitted 837 or the 835 may pay multiple 837’s.

Commonly inquiries are made from the provider office to the payer office because the 835 EDI Transaction is only paying a portion of the 837. This is explained in detail under sections of where the 837 spans policy dates, additional information is required for a procedure(s), the office secretary needs additional explanation of an adjustment reason code, bundling, and splitting of claims or lines. Another common mistake is that the 837 requires that primary name field is the insured’s name with the patient’s name being secondary. However in the 835 these sections are reversed. The contract for payment is with the insured and the patient may be a dependant. Another common reason is that the provider of service feels that the amount paid for a particular procedure was underpaid.

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