Healthcare Industry and the EDI 835 and EDI 837 Transaction Sets.

Question: Hi Louisa, I work in the Healthcare Industry and have been recently asked by one of our trading partners if we can handle the EDI 837 and EDI 835 Transaction Sets. Do you know what these are?

Answer: Hi Stephanie, thanks for your question. I will answer separately on both the EDI 837 and EDI 835 as follows:

The EDI Health Care Claim Transaction set (EDI 837) is used to submit health care claim billing information, encounter information, or both. It can be sent from providers of healthcare services to payers, either directly or via intermediary billers and claims clearinghouses. It can also be used to transmit health care claims and billing payment information between payers with different payment responsibilities where co-ordination of benefits is required.

EDI Health Care Claim Payment/Advice Transaction Set (EDI 835) can be used to make a payment, send an Explanation of Benefits (EOB), send an Explanation of Payments (EOP) remittance advice, or make a payment and send an EOP remittance advice only from a health insurer to a health care provider either directly or via a financial institution.

These transaction sets can be quite complicated to set up and if you are new to EDI, I would recommend that you outsource this function to an established 3^rd party EDI provider. For further details on EDI in the Healthcare Industry and the EDI 837 and EDI 835 transactions sets, please visit www.B2BGateway.Net or call (401) 491 9595

Louisa Gooding is Director of Sales & Marketing at B2BGateway.



Vendor Managed Inventory (VMI) and the EDI 852 Transaction Set.

Question: Hi Louisa, our customer (a large store retailer) wants us to do something called VMI and the EDI 852 document. Do you know what these mean?

Answer: Hi Todd, thanks for your question. Vendor-Managed inventory (VMI) is a business model in which the buyer of a product provides certain information to a vendor/supplier of that product and the supplier takes full responsibility for maintaining an agreed level of inventory, usually at the buyer's store. A third-party logistics provider (3PL) can also be involved to make sure that the buyer has the required level of inventory by adjusting the demand and supply gaps.

VMI helps develop a closer understanding between the supplier and buyer by using Electronic Data Interchange (EDI) formats; with one of the most common EDI transaction sets being the 852 (Product Activity Data document) . EDI 852 transaction sets may vary, but will typically contain the following information:

For each item
- Item description
- Item UPC

Data can be summarized by:
- Store
- Distribution center

Key product activity measures
- Quantity sold ($)
- Quantity sold (units)
- Quantity on hand ($)
- Quantity on hand (units)
- Quantity on order ($)
- Quantity on order (units)
- Quantity received ($)
- Quantity received (units)

The EDI 852 information can be sent from the buyer to the supplier on a weekly or daily basis. The order decision is based on the data in the 852 transmission. The supplier reviews the information that has been received from the buyer and an order determination is made based on the existing agreement between the supplier and buyer.

The EDI software will verify if the data is accurate and meaningful and will calculate a re-order point for each item based on the data and minimum stock levels agreed between buyer and supplier.

As a symbiotic relationship, VMI makes it less likely that a business will unintentionally become out of stock of an item and reduces inventory in the supply chain. Furthermore, supplier representatives in a store benefit the buyer by ensuring the product is properly displayed and store staff are familiar with the features of the product line. Suppliers benefit from more control of displays and consistent orders.

For further details on Vendor Managed Inventory (VMI) and the EDI 852 transactions set, please visit www.B2BGateway.Net or call (401) 491 9595

Louisa Gooding is Director of Sales & Marketing at B2BGateway.