In long-term care (LTC), efficient billing processes not only ensure that providers are paid accurately for their services but also contribute to the financial stability of an organization. The 837 file is critical in this process because it is used in the data exchanges between healthcare providers, payors, and the government.
What is the 837 file? The 837 file—or Electonic Data Interchange (EDI) 837 file—is a HIPAA electronic form used by healthcare providers to submit payment claims to payors, such as insurance companies and government programs like Medicare and Medicaid. In essence, this file is the electronic equivalent of the CMS-1500.
Why is the 837 file so important? In the context of long-term care, the 837 file is used to ensure timely and accurate reimbursement for the care provided to residents. Knowing how to use it effectively helps teams maximize reimbursement and streamline their billing and payment processes.
The components of an 837 file
The 837 file contains a wealth of information about the care provided to a patient or resident, including patient demographics, the patient’s condition, the care services that were provided, and how much the treatment cost.
In addition to this, one should note that 837 files are composed of segments, loops, and elements. Segments are the building blocks of the file and represent specific information, which is coded via the segment identifier located before each segment. Some common segment codes include:
- NM1- Name
- CLM- Claim
- PRV- Provider
- SBR- Subscriber
- N3- Street Address
- N4- City, State, and Zip code
- SV1- Service
- DMG- Demographic
- DTP- Date
- REF- Reference
Loops group related segments together. There are five primary sections of loops:
- 2000A- Billing Provider
- 2000B- Subscriber
- 2000C- Client, though this is only on the form if it’s different than the subscriber.
- 2300- Claim Information
- 2400- Service Line Information
Finally, elements provide specific details about each segment, making them the smallest component of an 837 file. When reading segments in an 837 file, pay attention to asterisks (*), which are used as element separators, and colons (:), which separate sub-elements.
If you notice the use of asterisks and colons side-by-side, the sub-element or the element itself is empty. Some of the element identifier codes you may encounter include the following:
- 85- Bill Provider
- Y4- Claim Casualty Number
- HC- Standard CPT Code
- 41- Claim Creator (Hardcoded to EI Assistant)
- ABK- Principal Diagnosis
- IC- Information Contact
- XX- NPI
- EI- EIN or Tax ID
- 472- Date of Service
- 82- Rendering Provider
- 77- Service Location
- DN- Referring Provider
- 40- Claim Receiver
- ABF- Diagnosis
- SY- Social Security Number
Understanding the different formats, segments, loops, and elements in an 837 file can help providers ensure accurate and timely reimbursement for the care they provide.
Here it is worth distinguishing between 837 files, which present payment requests for services provided by healthcare providers, and 835 files, which are used to obtain payment and remittance advice. Healthcare providers produce 837 files, while the payors produce 835 files.
The Benefits of 837 Files in Long-Term Care Billing
The challenges of billing in long-term care include managing complex reimbursement systems and ensuring accurate and timely payment for services rendered. Fortunately, since the introduction of 837 files in 2003, the process has become more streamlined and intuitive. The 837 file also helps with the bottom line. Some of the benefits of using it include the following:
- More precise information exchange: The 837 file is designed to standardize the format and content of long-term care claims data, allowing for more precise and accurate communication between healthcare providers, insurance payors, and clearinghouses. This standardization of data reduces errors and inconsistencies in claims data, resulting in fewer rejected or denied claims and more accurate reimbursement for nursing homes.
- Detecting mistakes and avoiding processing delays: Using effective nursing home software, facilities can efficiently perform error checks on 837 files. Doing so helps providers detect and correct mistakes before claims are submitted for payment. This helps to prevent processing delays while ensuring the timely filing of claims.
- Improving information quality for stakeholders: The 837 file format improves the quality of information exchanged between stakeholders in the billing and payment process by reducing confusion, errors, and delays in the billing and payment process. Patients, healthcare providers, insurance payors, and clearinghouses all benefit from the standardized format and content of the 837 file due to the improved billing and payment process.
- Dependable, secure, and accurate claims processes: The 837 file format uses a standardized format, which makes it easier for payers to process claims quickly and accurately while reducing the number of errors or fraudulent claims. Additionally, using secure EDI protocols helps protect sensitive patient and provider data during transmission.
In short, the 837 file helps long-term care providers maximize their reimbursement and provide high-quality care to their residents by:
- Improving the precision and quality of claims data
- Detecting mistakes and processing delays
- Guaranteeing dependable, secure, and accurate claims processing
Contact us here to try our efficient billing software for long-term care.
The 837P Explained
The 837 files in healthcare that we have discussed above are those in the 837I (Institutional) format, which is the standard format used by institutional providers—such as long-term care facilities—to transmit healthcare claims electronically to payors.
The 837D is a dental claim. These 837 files are used by dental professionals and dental providers, while the 837P is the standard format used by healthcare professionals and suppliers to transmit claims electronically to payors.
At this point, one should have a clear understanding of what 837 files are in healthcare, their benefits, and the different formats that are currently available thanks to HIPAA changes. Next, we will look at some common issues nursing home staff may encounter when dealing with 837 files.
The 837 File: Challenges and Common Issues
The 837 file is a convenient form that facilitates the payment process. However, making mistakes on these forms can result in delays in processing. So what should you look out for?
There are two categories of errors related to 837 files that can cause issues when processing an 837 file: functional errors (at the file level) and critical errors (at the claim level). Here we will briefly explain both categories.
Functional (or structural) errors occur at the file level and can prevent the entire 837 file from being processed. These errors can be caused by issues with the software used to generate the 837 file or errors in data input. Examples of functional or structural errors include the following:
- Missing segments or loops
- Incorrect segment order
- Incorrect segment lengths
Long-term care staff looking to avoid this error type should ensure that the 837 file is generated correctly by checking to see that all required segments and loops are included. Furthermore, evaluating the file using the appropriate implementation guide can help identify and resolve any functional or structural errors before the file is submitted.
Critical errors, meanwhile, are those that occur at the claim level and can prevent individual claims from being processed. These errors can similarly result from the healthcare provider’s billing software or from data entry errors. Examples of critical errors include the following:
- Missing or incorrect patient information
- Incorrect procedure codes or diagnoses
- Incomplete service line information.
Similar to the previous category of errors, with critical errors, nursing home staff must verify that all required data elements are included in each claim and that the data is accurate and complete.
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