Electronic Data Interchange

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Electronic data interchange (EDI) is the electronic transfer of information (such as electronic health care claims and supplemental information) in a standard format. EDI allows entities within the health care system to exchange medical, billing, and other information to process transactions in a more expedient and cost effective manner. Use of EDI reduces handling and processing time and eliminates the risk of lost paper documents. EDI can therefore reduce administrative burdens, lower operating costs, and improve overall data quality.
EDI is authorized through subtitle F of title II of HIPAA. Congress added to title XI of the Social Security Act (‘‘the Act’’) a new subpart C, entitled ‘‘Administrative Simplification.’’ [1]