What Is ERA (Electronic Remittance Advice / 835)?
The ERA (X12 835 transaction) is the HIPAA-standard electronic file payers send to providers detailing claim adjudication results — payments, adjustments, denials with CARC/RARC codes — typically paired with EFT funds transfer.
- Auto-post 835 files into the PM system to reduce manual posting effort by 80-90%.
- Build a denial workflow that creates work-queue items for every CARC/RARC combination beyond the standard contractual adjustments — this turns the 835 into both a cash-posting tool and a denial-detection system.
ERA (Electronic Remittance Advice / 835)
Also known as: Electronic Remittance Advice; 835 Transaction; EFT/ERA
The ERA (X12 835 transaction) is the HIPAA-standard electronic file payers send to providers detailing claim adjudication results — payments, adjustments, denials with CARC/RARC codes — typically paired with EFT funds transfer.
Definition
The ASC X12 835 Health Care Claim Payment/Advice transaction is the provider-facing complement to the 837 claim submission. Each 835 file contains one or more claim payment records with paid amount, contractual adjustments (CARC), informational remarks (RARC), patient responsibility splits, and any provider-level adjustments (PLB segments — refunds, recoupments, capitation, late charges). HIPAA mandates payer support for the 835. Providers typically enroll in EFT (Electronic Funds Transfer) and ERA simultaneously through the payer or via a clearinghouse-mediated enrollment service.
Example
An 835 file from BCBS shows three claims: claim 1 paid $98 with CARC 45 ($52 contractual adjustment); claim 2 denied with CARC 50 (medical necessity not met); claim 3 paid $85 with CARC 1 ($30 deductible) and RARC N382 (missing/incomplete patient identifier). Total EFT deposit equals the sum of paid amounts minus PLB recoupments.
Common Misconceptions
An 835 file is not a single payment — one 835 typically contains many claims for one EFT deposit. Auto-posting tools must reconcile the 835 to the bank deposit (the BPR segment carries the EFT trace number) to avoid posting duplicates or unmatched payments.
Practical Application
Auto-post 835 files into the PM system to reduce manual posting effort by 80-90%. Build a denial workflow that creates work-queue items for every CARC/RARC combination beyond the standard contractual adjustments — this turns the 835 into both a cash-posting tool and a denial-detection system.
Related Terms
EOB (Explanation of Benefits)
An Explanation of Benefits is a payer-issued document sent to the member (and sometimes the provider) after claim adjudication that itemizes the services billed, allowed amount, plan payment, deductible/coinsurance/copay applied, and patient responsibility.
Read definition arrow_forwardCARC
A Claim Adjustment Reason Code is a standardized code maintained by the X12 External Code List committee that explains why a claim line was adjusted (paid less than billed, denied, or transferred to patient responsibility) on a payer's 835 ERA.
Read definition arrow_forwardRARC
A Remittance Advice Remark Code is a supplemental code used on the 835 ERA to provide additional information about an adjustment, often clarifying or specifying the reason behind a CARC; RARCs are maintained by CMS and the Remittance Advice Code Committee.
Read definition arrow_forwardPayment Posting
Payment posting is the revenue cycle step where insurance payments (from 835 ERA or paper EOBs) and patient payments are applied to specific claim lines and patient accounts in the practice management system, including contractual adjustments and denial transfers.
Read definition arrow_forwardX12 (HIPAA EDI)
ASC X12 is the standards body whose X12N subcommittee develops the HIPAA-named electronic data interchange transactions for healthcare administrative data: 837 (claims), 835 (remittance), 270/271 (eligibility), 276/277 (claim status), 278 (prior auth), and 834 (enrollment).
Read definition arrow_forwardWhere This Applies on MedPrecision
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