Understanding Claim Files

What exactly is a claim file?

A claim file is simply a specially formatted file that provides an insurance company the information they need to process a claim for reimbursement from a healthcare provider.  The standard for what’s included  in the file and how it is formatted originate from HIPAA.  We tend to think of the Privacy Rule in HIPAA, which sets the limits on how healthcare information can be used and disclosed, but less well-known component of HIPAA is the Administrative Simplification Rule.  At a time when computers were just starting to see widespread use, this rule established how one computer could “talk” to another computer to share information. 

HIPAA was smart enough to know that it needed to be flexible, as computers were rapidly expanding in their capabilities.  Rather than establishing standards in the law itself (which could then only be changed by another act of Congress), HIPAA gave authority for creating these standards to an outside body.  This organization is called X12, note that you may have seen references to “ANSI X12 files” when referring to healthcare transactions.  In the nearly 30 years since HIPAA was introduced, X12 has put out several versions of these standards to keep up with the changing healthcare landscape.  The current version is 5010.  When a portal asks for a “5010 file” it is asking for a file built to a specific version of the standard, this way it  knows how to read what is in the file. 

The 5010 is very similar to the file extension you see at the end of files on your computer – you know that a .doc file would open in Word or an .xls file would open in Excel.  Each of those programs allow you to create multiple different types of files though, so you may be writing a formal business letter or updating a resume in Word, or tracking inventory or project progress in Excel.  These 5010 files support similar flexibility in that they can be used to submit an insurance claim, receive remittance advice, or even check eligibility for services and obtain a prior authorization.  This is where the 837 or 837P identifier comes into play. The 837 indicates that this 5010 file is a health insurance claim, and 837P means it is a professional claim, rather than a hospital or dental claim.  The 835 refers to remittance advice, or ERAs. 

TL;DR - “ANSI X12,” “5010,” and “837” all ultimately refer to the same thing in this context – a file that asks the insurance company to pay a healthcare provider for services rendered to their client. 


What do all those symbols mean?

When we read a paragraph, we automatically understand that there are some places where we should pause, and some places where an entirely new idea  begins.  A period tells us a sentence is over and a new one will begin.  We expect that new sentence will start with a capital letter.  If we want to add items to a list, or provide additional details about something, we use commas.  Each of the symbols in file has a similar purpose.   

The file is broken up into loops and segments.  Loops are like paragraphs, and segments are similar to sentences.  Just like sentences begin with a capital letter, segments begin with an identifier.  The identifier tells you what type of information will be in the rest of that segment.  Segments end in a tilde (~), much like a sentence ends in a period.  Words in a sentence are separated by a space, and elements in a segment are separated by an asterisk (*).  The colon (:) is like a hyphen in words, as it breaks a single element into additional pieces that come together to mean a single thing. 


So how do I read a claim file?

To know all the specifics of the claim file, you would need a copy of the claim file manual published by X12.  However,  you can get a general idea of what each piece of the claim file means if you break each segment down and think of them as similar to boxes on a CMS-1500 form.  Claim files and 1500 forms are not exactly the same – there is much more room for detail in a claim file, and the rules for completing one are far more complex.   

Just as a 1500 form asks for the name of the patient, the insured party, the practice, and the clinician, all of those details are in a claim file as well.  The segment that includes a name begins with NM1, and different parts of a name (and often a specific identifier like a member ID or NPI) are included in that segment.  The segment ends in a tilde(~) , then another segment begins.  Addresses begin with N3 and N4, dates with DTM (formatted YYYY-MM-DD), and so on.  REF segments are used to provide additional details about something.  SV1 segments are similar to box 24 on the 150 forms – they contain details about the service such as the service code, modifiers, rate, number of units, and so on.  Take a moment to look at the information in each segment, and you’ll likely be able to figure out what it is trying to convey to the insurance company. 


I'm looking at a segment and am completely lost. What is it?

Since these files are meant to be read by a computer, and not a human, there are several segments that probably look like a bunch of gibberish.  These are likely to be the segments at the beginning and end of each claim file.  Look closely into them and you might see some things you recognize: 

  • At the very beginning of every file, you’ll see an ISA segment.  This is part of the transaction “envelope.”  Much like a regular envelope for mailing 1500 forms to a payer, this segment includes coded information about who the file is being sent between (the sender and receiver) and when the transaction is happening.  It also includes some information that will tell the receiver how to read the rest of the file (like selecting a language on one of our outcome measures!).   
  • At the end of a GS segment, you’ll likely see something like “005010X221A1” – our old friend 5010 is hiding in there.   
  • In the ST segment you’ll find “837” and that “005010X221A1” again.  These segments are used to tell the receiving computer what type of file it is (like a Word doc or Excel spreadsheet), as well as which template the file is following (for example, a claim or remittance advice). 
  •  Each of these segments has a paired segment at the of the file.  These tell the computer that this claim is over and provide some error checking and validation to make sure that the file is read correctly. 

I need to make some changes to the file for the specific portal I'm uploading to. How do I do that?

Just like learning another language, it is much easier to understand a file than to create one.  However, there are some common scenarios that can help get your claims through effectively: 


Wrong Payer ID

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TherapyNotes uses the payer IDs set by Change Healthcare, so when submitting through a different clearinghouse, you may need to use a different payer ID to ensure claims are routed to the correct payer.  We know that NM1 segments are used for names, so that will be the place to look for payer names.  The next element (after the asterisk) in an NM1 segment tells you what type of name is in the segment.  Look for “NM1*PR*2” – those segments are the ones with the payer’s name.  Keep reading through that segment, and you’ll see the payer’s name, several asterisks, and then the letters “PI.”  PI means that the next element will be the payer ID. You will then see the 5-character payer ID followed by a tilde.  Replace the 5-character Change Healthcare ID with the corresponding ID from your clearinghouse of choice.  Make absolutely sure that what you enter stays between the asterisk after “PI” and the tilde at the end. 


Editing the Envelope

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This is an especially tricky thing to do, but can be done effectively and made into an easily repeatable task.  If you had to send CMS-1500 forms to a payer over and over again in the mail, you’d probably find a way to make the process simpler.  One way would be to print out address labels – enter the information one time, and simply print as many labels as you need.  Slap one on the front of the envelope and you’re all done. We can do something similar with the claim envelope: 

  • First, you need to know how elements are counted.  The segment identifier is number 0 within elements.  Next is an asterisk, then element 1, another asterisk, element 2, and so on.  An easy way to count elements is simply to count asterisks, and the element follow immediately to the right.  If a portal tells you that ISA-07 needs to be a particular value, start at the ISA identifier and count 7 asterisks over.  The text immediately following that asterisk is what needs to be replaced.   
  • Some elements, like ISA-06, are required to have a certain number of characters in them.  Your portal will tell you to fill the element with trailing spaces (such as “123456789      “).  Once you have made changes to the header, save it somewhere for easy access and use copy+paste on each header as needed.   
Note: Do not replace the entire ISA header segment – ISA-13 must be a unique number that is identical to IEA-02. If you reuse this number it will likely confuse the payer processing system. If the numbers do not match exactly, the claim will be rejected..

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