Glossary

Revenue cycle and HIM terms, in plain English.

Short, careful definitions of the terms that come up in denials, coding, compliance and digital health work.

35 terms

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835 (Electronic Remittance Advice): The ASC X12 835 transaction, usually called an ERA, is the standard electronic format for a payer’s explanation of payment. For each claim it lists what was paid, adjusted or denied, with CARC and RARC codes explaining why.Health Data & Intelligence →
837 (Healthcare Claim): The ASC X12 837 transaction is the standard electronic format for sending a claim from a provider to a payer or clearinghouse. It comes in professional (837P), institutional (837I) and dental (837D) versions.

A

Agentic AI: Agentic AI refers to systems that can plan and carry out multi-step tasks by using tools and data sources, rather than only answering one prompt at a time. In regulated settings such systems need clearly defined authority, an audit trail, and human review of consequential actions.Agentic AI & Intelligent Automation →Agentic AI governance in US health systems →
Appeal: An appeal asks a payer to reconsider a denied or underpaid claim. Appeals usually have several levels (for example first-level and second-level), and filing deadlines and required documentation vary by payer and plan, so the deadline on the denial notice is the one that matters.Intelligent Health Operations →

B

BAA (Business Associate Agreement): A business associate agreement is a contract HIPAA requires between a covered entity and a business associate that creates, receives, maintains or transmits PHI on its behalf. It sets out the permitted uses of the information and the safeguards the business associate must apply.

C

CARC (Claim Adjustment Reason Code): A Claim Adjustment Reason Code appears on a remittance advice to explain why a claim or line was adjusted. It is paired with a group code: CO (contractual obligation), PR (patient responsibility), OA (other adjustment), PI (payer-initiated reduction) or CR (correction and reversal).Free readiness resources →
CDI (Clinical Documentation Integrity): Clinical documentation integrity, sometimes called improvement, is the practice of reviewing clinical documentation so that it is complete, accurate and specific enough to support correct coding, quality reporting and reimbursement.Intelligent Health Operations →
CDM (Charge Description Master): The charge description master is a provider’s master list of billable items and services, with their charges and associated codes. Errors in it flow directly into claims, which is why CDM maintenance is a common revenue integrity task.
Clinical modification (CM): A clinical modification is a country-specific adaptation of the WHO International Classification of Diseases, with added detail for national uses such as payment. The United States uses ICD-10-CM, maintained by the National Center for Health Statistics. Whether ICD-11 would need a US clinical modification is an open question that the national health data advisory committee has asked HHS to research.ICD-11 for US health organizations →
Clean claim rate: The clean claim rate is the share of claims that are accepted and paid on first submission without needing correction or rework. It is closely related to what some organizations call first-pass yield; definitions differ, so confirm how a number is calculated before comparing it.
Clearinghouse: A clearinghouse receives claims from providers, checks them for format and basic errors, and routes them to payers. It also returns acknowledgements and, often, remittance files.

D

De-identification: De-identification removes identifying information so that data is no longer PHI under HIPAA. The two recognized methods are Safe Harbor, which removes 18 specified types of identifier, and Expert Determination, in which a qualified expert documents that the risk of re-identification is very small.Health Data & Intelligence →
Denial rate: The denial rate is the share of claims a payer denies. Definitions vary — by claim count or by dollars, initial denials or final, and which claims count in the denominator — so state the definition before comparing numbers between organizations or time periods.Intelligent Health Operations →

E

E/M (Evaluation and Management): Evaluation and Management codes are the CPT codes used to report patient visits and assessments, such as office visits and hospital care. Under current CPT guidelines the level of service is selected using medical decision-making or time, depending on the code family.CY2027 Medicare Physician Fee Schedule →

F

FHIR (Fast Healthcare Interoperability Resources): FHIR is an HL7 standard for exchanging healthcare data using modern web APIs and structured “resources” such as patients, claims and observations. It underpins many patient-access and payer interoperability APIs.Digital Health & Interoperability →CMS-0057-F and the FHIR prior authorization APIs →

H

HCC (Hierarchical Condition Category): Hierarchical Condition Categories group diagnosis codes for use in risk adjustment models, such as the CMS-HCC model for Medicare Advantage, which predict expected healthcare costs. Accurate, supported diagnosis coding directly affects risk scores.Audit, Compliance & Risk →
HIM (Health Information Management): Health information management covers how patient health information is collected, coded, stored, protected and released. Its work includes coding, documentation integrity, release of information, data quality and privacy.HIM Technology Readiness Self-Assessment →
HL7: Health Level Seven International is the standards organization behind HL7 version 2 messaging, the Clinical Document Architecture (CDA) and FHIR.
Human-in-the-loop: Human-in-the-loop describes a system design in which a person reviews, approves or can override the consequential decisions of an automated system before they take effect, keeping a named human accountable for the result.How we work →

I

ICD-10-CM (diagnosis codes): ICD-10-CM is the US clinical modification of the WHO’s tenth revision of the International Classification of Diseases. It is the HIPAA code set used for diagnoses on healthcare claims and is maintained by the National Center for Health Statistics. It has been in use for claims since October 1, 2015, and is updated every year. Inpatient procedures are coded separately, in ICD-10-PCS.ICD-11 for US health organizations →
ICD-10-PCS (inpatient procedure codes): ICD-10-PCS is the US code set for reporting procedures in hospital inpatient settings, maintained by the Centers for Medicare & Medicaid Services. It is separate from ICD-10-CM, which is for diagnoses. It is a US system: ICD-11 does not include a procedure classification, so a move to ICD-11 for diagnoses would not by itself replace it.ICD-11 for US health organizations →
ICD-11: ICD-11 is the World Health Organization’s eleventh revision of the International Classification of Diseases, adopted by the World Health Assembly in 2019 and in effect since January 1, 2022. It has more than 17,000 diagnostic categories and adds detail through extension codes rather than a separate code for every combination. The United States has not set a date to use it for diagnoses on claims; ICD-10-CM remains the HIPAA code set.ICD-11 for US health organizations →

L

LCD / NCD (Coverage Determinations): A National Coverage Determination (NCD) is issued by CMS and applies nationwide; a Local Coverage Determination (LCD) is issued by a Medicare Administrative Contractor for its jurisdiction. Both describe when an item or service is considered reasonable and necessary, and are commonly cited in medical necessity appeals.

M

MAC (Medicare Administrative Contractor): A Medicare Administrative Contractor is a private organization that contracts with CMS to process Medicare fee-for-service claims and administer local coverage policy for a geographic jurisdiction.
Medical necessity: Medical necessity is the standard a payer applies to decide whether a service is appropriate and needed for a patient’s condition, based on accepted standards of care and its own coverage policy. Medical necessity denials (for example CARC 50) are commonly appealed with clinical documentation tied to the payer’s criteria.Intelligent Health Operations →
MUE (Medically Unlikely Edit): A Medically Unlikely Edit is a CMS limit on the units of service of a code that a provider would normally report for one patient on one date of service. Claims that exceed it may be denied or adjusted.

N

NCCI (National Correct Coding Initiative): The National Correct Coding Initiative is a set of CMS edits designed to prevent improper payment when codes are reported together incorrectly or in excess. It includes procedure-to-procedure (PTP) edits and Medically Unlikely Edits (MUEs).

P

PHI (Protected Health Information): Protected health information is individually identifiable health information, in any form, that is held or transmitted by a HIPAA covered entity or business associate. It should not be sent through general-purpose channels such as website forms or ordinary email.Trust center →
Post-coordination: Post-coordination is how ICD-11 adds detail: a stem code for the condition is clustered with one or more extension codes for things such as severity, laterality, anatomy or a substance, instead of a separate code existing for every combination. Extension codes begin with X and cannot be used alone. The opposite approach, a single code that already contains the combination, is called pre-coordination, and is how ICD-10-CM mostly works.ICD-11 for US health organizations →
Prior authorization: Prior authorization is a payer requirement to approve certain services, procedures or drugs before they are delivered. A missing or invalid authorization is a common cause of denials (for example CARC 197).Digital Health & Interoperability →CMS-0057-F: what the prior authorization rule means for providers →

R

RADV (Risk Adjustment Data Validation): Risk Adjustment Data Validation is the CMS audit process that checks whether diagnoses submitted by Medicare Advantage organizations for risk adjustment are supported by medical record documentation.Audit, Compliance & Risk →
RARC (Remittance Advice Remark Code): A Remittance Advice Remark Code supplies additional information about an adjustment, or a processing message, that a CARC cannot fully convey. The RARC code set is maintained by CMS.
RCM (Revenue Cycle Management): Revenue cycle management covers the administrative and clinical processes that track a patient’s care from registration and scheduling through coding, billing, payment and follow-up.Intelligent Health Operations →
Revenue integrity: Revenue integrity is the set of practices that makes sure services are captured, coded, charged and paid correctly and in compliance with rules — protecting both revenue and the organization from audit risk.Audit, Compliance & Risk →

T

Timely filing: Timely filing is the deadline a payer sets for submitting a claim after the date of service. Claims filed later can be denied (for example CARC 29) unless an exception applies; the limit varies by payer and contract.

Definitions are general and educational. Payer policies, plan documents and current regulations always govern, and details such as deadlines and thresholds vary — confirm specifics against the primary source before acting.