Explore 3 Entities Between Which EDI 834 Process Flows

5 min readOct 6, 2021


What happens when the employees are safeguarded by their corporate company is they appreciate it and prefer to stay for longer with such employers. They spread the better word of mouth in and around their acquaintances which brings more brand recognition to the company.

The more customizable employee benefits a company offers, the more chances that the customer would be happy to work for it.

Consider being a part of an IT outsourcing company, where you deal with international clients in a different time zone. Or assume yourself as a worker in a mechanical industry where you work around 6 hours per day between hazardous machinery. Employee benefits become not only important for you here, but for your family as well.

What we get to conclude here is that benefits are a vital part of building brand loyalty and recognition, as well as an essential factor to sustain the employee retention rate.

How is EDI 834 connected with it?

EDI i.e. Electronic Data Interchange is a technology that facilitates the easy and safe transfer of information from one end to another, irrespective of the distance between two peers. It has multiple sets of transactions named differently as per their type and purpose.

For example, EDI 834 transaction set is specifically in use for benefits enrollment and administration purposes.

The Three Entities Around Which EDI 834 Revolves

When an employer enrolls its employees into benefits, the employer becomes a ‘Payer’.

The company from which the company draws the benefits plans for its employees is called an ‘insurance carrier’. Sometimes, the employees prefer reaching the healthcare exchange points that work specifically as a point of benefits administration for employees, irrespective of their organization.

Now what happens usually is, the employees might not find this process of enrollment and onboarding very engaging, thus, they hire a ‘benefits broker’ to do the needful for them, and involve them for the paperwork only, that too whenever it is required.

Not only the employees but also the employers hire benefits brokers for their ease of work.

Therefore, we got 3 main entities that play a vital role in the process of benefits enrollment, where EDI 834 has to play an important role.

What if the process of benefits allotment gets affected?

The process basically flows in a simple manner as described below-

  1. The employer asks its employees to get enrolled with the benefits. Or, the employees might reach the healthcare exchange points and choose to get enrolled through it only. In both cases, the employee is getting enrolled with the benefits. And the employer is going to pay for the benefits that the employee is choosing.
  2. Benefits broker comes as a middle man between the two entities involved in the first step. It has the role to keep the process flow smoothly, to check on its transparency and proper execution.
  3. Now, when the ‘payer’ i.e. the employer pays to the healthcare provider or the healthcare exchange point, the healthcare provider generates an invoice for the payment and sends it to the payer. And the payer processes that invoice and completes the payment, will send back the receipt to the prior one and completes the payment part.
  4. Meanwhile, this payment process, EDI 834 transaction set is used to keep the information of the payer and the receiver safe and unshared with any foreign body.

It is possible in rare cases that the information kept safe through EDI technology, may also get leaked or the transaction does not get executed properly.

In this case, all three entities may get disturbed. How?

Suppose, if the payment has been made by the employer, but the EDI transaction does not get completed. In this case, neither the healthcare provider will get the information of being paid, nor the employer i.e. Payer would get the information of its payment being received by the healthcare provider.

Similarly, if the transaction loses its safety, the broker would not be notified of the completion of the concerned step. And if the broker is not notified, the employee would remain unenrolled.

These are some rare cases when even the most secure translation method gets failed. However, this would be a millennial case and one should not opt-out ‘EDI’ after reading these facts. This information is only for the awareness purpose and to highlight the fact that no such technology is yet available that can guarantee a cent percent safety from fraud and data breaching.

EDI 834 process flow usually goes smooth and no such requirements are needed to keep the EDI 834 highway clear from possible hazards. Yet, if the precautions are important for you than any other thing, you may construct an EDI architecture with layer-based services.

There are factors that play a major role in the process flow of EDI 834, and they are-

  1. EDI web services
  2. EDI mapping
  3. Meta-data of Schemas
  4. Compliances and Business rules

Having an EDI architecture constructed would free you from the data-related possible hazards.

In addition, the type of transaction is easy to analyze. By doing this, the focus can be emphasized on the most required factor. For example, if we have analyzed that a particular EDI 834 transaction needs special attention on its mapping, the layer-based architecture would emphasize its mapping first and then let it move ahead.

Also read: A step-by-step guide to Master EDI Mapping

And there will be no need to develop an individual architecture for every healthcare exchange point or entity enrolled every time.

Conclusively, all that you need to keep the transactions safe, the first thing would be EDI managed services. The second would be to keep the EDI process flow safe, and that can be done by hiring an intelligent experienced EDI service provider like A3logics, who has more than 15 years of experience in providing benefits administration solutions globally spread organizations.

Make sure to hire the best one who would not just provide you the required services but also support you as a consultant in the case of any ups and downs as EDI is an intricate technology that needs agile eyes and capable hands to handle.




A3logics delivers value-added industry-specific business technology consulting, IT solutions and services to businesses across the globe. marketing@a3logics.in