Electronic Data Interchange (EDI)
Definition - What does Electronic Data Interchange (EDI) mean?
Electronic Data Interchange (EDI) is a system that allows companies to exchange data between their internal systems without anyone actually having to send the data. The data is automatically sent from one storage system to the next.
Insurance companies can use EDI to exchange data with independent agents, hospitals, or any other entities that may need access to the insurance company's data.
Insuranceopedia explains Electronic Data Interchange (EDI)
Not all data can be exchanged via Electronic Data Interchange. In fact, some data is extraordinarily sensitive and must be handled with the highest degree of care. When it comes to non-sensitive data, however, insurance companies can save a substantial amount of time and money by using EDI. These savings come primarily from not having to pay someone to fax or email all of the data to the party that requests it.