Electronic Data Interchange (EDI) has become an increasingly important technology in the healthcare industry, especially in regard to claims processing. The standard, structured format of EDI allows for the secure exchange of sensitive information, such as patient records and billing information, and helps streamline the often complex and time-consuming administrative processes in healthcare.
Even with the introduction of new technology, EDI is still a major part of healthcare claims processing and it continues to gain adoption, making ongoing optimizations a smart area of focus in 2023 and beyond.
Big-Picture Trends in Healthcare EDI
The global healthcare EDI market was valued at around $3.0 billion in 2020, and it is expected to reach $4.4 billion by 2025. Increased security and accuracy, improved efficiency, and standardized communication between parties have all attributed to this rapid growth.
One of the primary benefits of EDI in healthcare is its ability to secure the exchange of sensitive data quickly and in a standardized format. This ever-present communication between parties reduces processing delays while maintaining HIPAA compliance through ASC X12 protocol.
In addition to the standardization and security benefits of EDI, it also helps improve processing efficiency. The healthcare sector is known for a high volume of paper transactions, which can lead to delays and inefficiencies in processing. EDI in healthcare helps manage this volume by automating many of the administrative tasks involved in claims processing, such as the transmission of claims and the tracking of payments.
What Does the Future Hold for EDI in Healthcare in Light of New Technology?
Despite the many benefits of EDI, there has been some debate over its staying power. The introduction of new technologies, such as web services and APIs, has led some specialists to suggest that EDI may no longer be necessary. These technologies may offer new advantages, but without standardization across the board, EDI in healthcare remains a core technology now and into the future.
Pivoting away from EDI proves to be costly and time-consuming. With a portion of organizations only recently coming into the digital expansion of EDI to begin with, it will remain the dominant data transfer technology for years to come until there is an unobtrusive protocol that can be integrated seamlessly to replace it. Healthcare organizations would be better off updating and improving their EDI than starting over with a new system.
One key trend away from EDI is the push toward FHIR API standardization. FHIR or Fast Healthcare Interoperability Resources is a shared platform with open innovation that allows for improved data sharing and communication among existing systems.
EHR vendors have been slow to adopt FHIR API standardization, as it is not yet a requirement for compliance with the Centers for Medicare and Medicaid Services (CMS). This is expected to change by the end of 2023 when CMS rules will require the use of FHIR APIs for certain transactions. Organizations should be aware of this trend and consider how they can incorporate FHIR API standardization into their EDI processes.
Healthcare EDI Clearinghouse Considerations
One major hurdle in EDI adoption is deciding between in-house management or outsourcing to an EDI clearinghouse. In-house solutions offer complete customization and control, but they also require specialized resources to build and maintain. Outsourcing to an EDI clearinghouse can provide greater interoperability and peace of mind, but it can also be expensive and challenging to manage, particularly if there are multiple partners involved. Likewise, the implementation of outside technology can be arduous without proper leadership.
EDI is an important tool in the healthcare industry, and it is likely to remain so for the foreseeable future. While new technologies may offer some advantages, EDI remains the core technology in healthcare today and into the future.
Take charge of your claims processing and make steps toward optimization with guidance from Smart Data Solutions. Learn more about our EDI clearinghouse and interoperability services, then reach out to meet with our in-house experts to start moving your organization in the right direction today!