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Glossary of Commonly Used
Electronic Data Interchange (EDI) Terms

 
 

ADJUDICATION: Steps followed by an insurance company to process a claim.

BROWSER: A software program that interprets documents written in HTML the main programming language of the World Wide Web. A browser such as Netscape or Microsoft Explorer is required to experience the photos, video and sound elements on a web page and assists in quick, easy travel around the world.

CLEARINGHOUSE: An agent between a provider and a payer that takes claims and other electronic data from providers, verifies the data integrity of the information, and forwards the proper forms to the payers. More than a transfer station, a clearinghouse acts as a fact-checker and a data format translator. It accepts and forwards electronic transmissions to insurance companies. The clearinghouse formats the data into the HIPAA 837 format, then batches the claims by payer and transmits them to each payer. It is an entity providing electronic connectivity to any number of payers. Providers can transmit all claims directly to a clearinghouse. Examples of clearinghouses are RECS, Envoy, Professional Alliance and Dentec/Softech. Some Practice Management System vendors also provide clearinghouse services. Examples of PMS vendors with clearinghouse capabilities are Professional Alliance and Dentec/Softech.

CONNECTIVITY: Software used to link personal computers to create a local area network (LAN).

DELTALINK: Delta Dental's trademarked name for the process of electronic data transmission between Delta Dental and different clearinghouses primarily associated with electronic claims.

DENTAL OFFICE TOOLKIT (DOT): Free online (Internet) service that allows providers the ability to submit claims and predeterminations, check claims status, review eligibility and benefits information and utilize Direct Deposit (EFT) of claims payments.

DIRECT DEPOSIT: See Electronic Funds Transfers.

ELECTRONIC CLAIM: The paperless submission of claims by using a specialized application.

ELECTRONIC CLAIMS SUBMISSION (ECS): Transmitting dental claims for adjudication (transfer of a request for payment and/or predetermination) from a practice to a payer. The dental office transmits claims to their clearinghouse, the clearinghouse reformats the data into the 837 format and transmits the claims on to the payers.

ELECTRONIC DATA INTERCHANGE (EDI): The conventional exchange of business transactions, documents or data over communications media using the HIPAA 837 electronic format from computer to computer. This means utilizing sophisticated software to transfer data through a telephone line from one computer to another. Dental claims are not transmitted directly to us. The dental office transmits claims to their clearinghouse; the clearinghouse reformats the data into the 837 format and transmits the claims on to the payers.

ELECTRONIC FUNDS TRANSFER: The transfer of payments directly into a provider's financial institution account rather than mailing out paper checks.

HARDWARE: A coordinated grouping of electrical equipment that performs specific tasks as specified by its user. For example, printers, keyboards monitors (screens) and the computer.

HEALTH INSURANCE PROTABILITY AND ACCOUNTABILITY ACT OF 1996 (HIPAA): A federal law that defines standard formats for certain health insurance transactions.

MODEM: A communications device that converts a computer's digital signals to transferable analog signals sent over a telephone line.

OPERATING SYSTEM: Computer software responsible for controlling the allocation and use of hardware resources and the execution of application programs. Examples of operating systems are Windows, DOS and UNIX.

PRACTICE MANAGEMENT SYSTEM (PMS): It is a generic reference to a software system that assists in the overall management of the practice. Examples of dental PMS are PracticeWorks, InfoSoft, SoftDent, Dentec/Softech and Professional Alliance. Some examples of PMS vendors with clearinghouse capabilities are Professional Alliance and Dentec/Softech.

PRACTICE MANAGEMENT SOFTWARE: See Practice Management System.

PRACTICE MANAGEMENT SOFTWARE VENDOR: The company where the software comes and who you call for service.

PAYER: A payer is any insurance or dental benefits carrier. Examples of payers are Delta Dental of Michigan, Blue Cross Blue Shield and MetLife.

SERVER: A computer that manages the resources on a network, controlling access to the software, printer and other devices as well as providing a centralized storage area for programs and data.

SOFTWARE: A collection of instructions (programming) with a friendly, easy to use interface that allows a user to perform specific tasks which processes data into information.


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