What is an 834 File in Healthcare?
An 834 file in healthcare is a benefit enrollment and maintenance file used to electronically exchange information about health plan members between employers, plan sponsors, third party administrators, and health plans. Because health plans are covered entities under HIPAA, an 834 file in healthcare must comply with the HIPAA 5010 version of the ASC X12N standard.
One of the primary objectives of HIPAA was to simplify the administration of health insurance in order to reduce the costs of providing and paying for health care. However, prior to the passage of HIPAA, many organizations that used Electronic Data Exchanges (EDIs) had developed their own transaction formats. It was estimated at the time that about 400 formats for electronic health claims were in existence.
Acknowledging that the use of different transaction formats limited the ability of healthcare providers and health plans to improve efficiency and reduce costs, Congress instructed the Secretary for Health and Human Services (HHS) to standardize the formats. In 2000, the Standards for Electronic Transactions to be used by all HIPAA covered entities were published in the Federal Register.
The standard selected for “enrollment and disenrollment in a health plan” was ASC X12N 834 – more commonly referred to as an 834 file in healthcare. The standard was updated to HIPAA version 5010 in 2009, and is now also used to notify health plans of changes to a plan member’s details – for example, adding or removing dependents, increasing or decreasing benefits, and correcting errors.
The Structure of an 834 File in Healthcare
Because an 834 file in healthcare can have multiple uses, the structure and content of an 834 file can change significantly depending on what it is used for. The example below demonstrates the information required to enroll an employee in a plan with health benefits and dental benefits. The content of the 834 file would be longer if the plan also had vision benefits or if dependents were included in the plan.
| Transmission Explanation adapted from https://x12.org/examples/005010×220 | |
| Transaction Codes Used | Explanation of Codes |
| Table 1 | |
| ST*834*12345*005010X220A1~ | Used to indicate the start of a transaction set and to specify a transaction set control number. |
| BGN*00*12456*20240520*1200****2~ | This is a transaction uniquely identified by the sender with reference #12456. The transaction was created on 5/20/2024 at 12:00 Noon. |
| N1*P5**FI*999888777~ | Specifies the sponsor/sender’s tax ID number. |
| N1*IN**FI*654456654~ | Specifies the insurance company/receiver’s tax ID number. |
| Table 2 | |
| INS*Y*18*021*20*A***FT~ | Beginning of Table 2. Indicates that the subscriber (John Doe) is adding coverage as an active employee. |
| REF*0F*123456789~ | John’s subscriber ID number. |
| REF*1L*123456001~ | This is the group number assigned by the carrier. |
| DTP*356*D8*20240523~ | The eligibility date for this transaction is 5/23/2024. |
| NM1*IL*1*DOE*JOHN*P***34*123456789~ | Subscriber’s name. |
| PER*IP**HP*7172343334*WP*7172341240~ | John’s home phone number is (717)234-3334 and his work number is (717) 234-1240. |
| N3*100 MARKET ST*APT 3G~ | This is John’s street address. |
| N4*CAMP HILL*PA*17011**CY*CUMBERLAND~ | This is John’s city, state zip code and county. |
| DMG*D8*19400816*M~ | This is John’s date of birth and gender. |
| HD*021**HLT~ | John is enrolling in a health benefit. |
| DTP*348*D8*20240601~ | The benefits under this plan begin 6/01/2024. |
| HD*021**DEN~ | John is enrolling in the dental benefit. |
| DTP*348*D8*20240601~ | The benefits under this plan begin 6/01/2024. |
| SE*18*12345~ | End of transaction set. 18 segments were sent and the control number in the ST segment is 12345. |
834 Compliance in Healthcare
Compliance with the Standards for Electronic Transactions is enforced by HHS’ Centers for Medicare and Medicaid Services (CMS). The agency has the authority to fine non-compliant entities – including self-funded employer-sponsored health plans and third party administrators – or require that they adopt corrective action plans if transactions are not compliant with the standards required by Part 162 of HIPAA.
Because of the multiple uses of an 834 file in healthcare, there are a number of ways in which mistakes can be made which lead to a complaint to CMS when mistakes are frequent or repeated. These include, but are not limited to:
- Entering incorrect subscriber ID numbers can result in dependents being added to the wrong subscriber.
- Entering incorrect group numbers can result in subscribers’ memberships being invalidated or delayed.
- Entering dates incorrectly can disrupt the “enrollment journey” – especially when dates contradict each other.
- Entering any ASC X12N code incorrectly can lead to 834 file rejections and processing errors.
Covered entities that experience problems with 834 compliance have several options available to them. These include workforce training with regular data validation checks thereafter, EDI transaction management and compliance software, and automation. Covered entities that require further information about these options should seek independent compliance advice.
