Reducing costs through electronic data interchange.

The times have never been riper for an investment in EDI to pay off for healthcare providers. As suppliers attain their implementation goals for electronic purchase orders, they are expanding their EDI capabilities. One area which seems to be attracting considerable attention is the entire contracting cycle, where there are numerous opportunities for reducing administrative costs and improving accuracy. A detailed example using a buying group's contract cycle shows how EDI can be used at every step of the way, from request for quotation to funds transfer and monthly purchase summaries. EDI can be implemented at any level, from PC to mainframe. Implementation is not cheap and integration may not be easy, but the benefits can justify the cost. The first step to successful implementation is to identify and quantify, throughout the entire organization, reengineering opportunities in which EDI can be used. Two industry organizations, the Health Industry Distributors Association (HIDA) and the Healthcare EDI Corporation (HEDIC) have taken leadership roles in simplifying the implementation process.