Healthcare Industry Shifting to More Efficient Claim Statusing

CMS recommends providers adopt EDI 276/277 Transactions for Medicare

April 19, 2023

As the healthcare industry moves towards greater interoperability using electronic exchange of health information, EDI transactions are becoming increasingly substantial. Although various methods exist for obtaining claim status information from MACs (Medicare Administrative Contractors), CMS (Centers for Medicare and Medicaid Services) recommends using EDI 276/277 transactions as the preferred method of obtaining claim status.

The Recommended Approach: EDI 276/277 Transactions

Providers can automatically generate and submit a Health Care Claim Status Request (276 transaction) electronically and receive a Health Care Claim Status Response (277 transaction) from Medicare through this recommended method. The 277 response is designed to enable the automatic posting of the status information directly to patient accounts, eliminating the need to manually enter individual queries. This has the dual advantage of reducing errors and obviating the need to call a contractor to obtain this information. As a result, the use of EDI 276/277 transactions is a more efficient alternative for providers and Medicare.

A well-known alternative to obtain claim status information is through the use of DDE (Direct Data Entry). DDE is a web-based system that allows healthcare providers to manually enter and submit Medicare claims and make real-time updates or corrections as needed. It is designed to be used by individual authorized users who enter and submit claims using their own user credentials.

Recently, MACs have been updating their websites with language discouraging the use of automatic scripting to obtain information from the DDE. Automated scripting involves the use of software programs or bots to access and retrieve information from DDE automatically. One of the reasons for not permitting automatic statusing using scripting is that it can potentially compromise the security of the Medicare system by allowing unauthorized access to protected information. It can also interfere with the normal functionality of the DDE, which can lead to delays in claim processing. Due to this, MACs are now implementing measures to detect and prevent automated scripting—and potentially could take action against providers who engage with these programs. Under CMS’ recommendation, MACs also support the use of electronic EDI 276/277 transactions, which remain secure and are designed for automatic processing.

Advantages of Streamlining Medicare Claims

EDI 276/277 transactions use a standardized format for exchanging information between healthcare providers and Medicare. These standard category and status codes are designed to be interoperable with other healthcare systems and providers, unlike DDE manual codes, which can vary from one healthcare provider to another. Providers utilizing integrated HIS systems could see the most benefit with standardization, as Medicare claims can be worked the same as other claims using EDI 276/277 functionality.

This functionality can also offer cost savings, as EDI transactions reduce administrative costs associated with paper-based processes, including printing, mailing, and processing paper claims, as well as labor costs for manual data entry.

Overall, the real difference lies in simplifying the process for billers and boosting productivity through the EDI method.

Not all claim status partners offer this capability, so it’s crucial to partner with one that already has established connections with various MACs.

SSI is well-versed in EDI 276/277 transactions. If you’re ready to get ahead and make a move to this preferred method, contact us to see how we can facilitate a seamless transition.