What is EDI 835?

The standard electronic file a payer sends after adjudicating claims, itemising what was paid, what was adjusted, and why.

Definition

The EDI 835 — formally the Health Care Claim Payment/Advice transaction — is the electronic remittance a payer produces once it has finished adjudicating a batch of claims. It is the machine-readable counterpart to the paper explanation of benefits, and it is the authoritative record of what a payer decided about each claim line.

Structurally, an 835 carries a payment header (the check or EFT amount and trace number), then one claim payment loop per claim, then service payment loops per line. Each of those loops carries CAS segments — claim adjustment segments — that name a group code (CO, PR, OA, PI) and a claim adjustment reason code explaining every dollar that was not paid. That CAS data is what makes denial and underpayment analysis possible at all: without it you know a claim underpaid, but not why.

Practices receive 835 files from their clearinghouse, directly from payer portals, or through their EHR. Because the file is standardised across payers, one parser can read remittances from every payer a practice bills — which is precisely why remittance-based reporting scales where portal-by-portal checking does not.

Why it matters

The 835 is the only source that ties a payment, an allowed amount, and a denial reason together in one record. Any denial rate, net collection rate, or payer scorecard that is not built from 835 data is an estimate.

Denial codes to know

Related terms