IAIABC EDI Licensing Frequently Asked Questions
In the early 1990s, the workers' compensation industry approached the IAIABC to request the development of national standards for workers' compensation electronic data reporting to jurisdictions. Using a consensus-based process, to date the IAIABC EDI committees have developed and maintain EDI standards for reporting Claims (First and Subsequent Reports of Injury), Proof of Coverage, and Medical Bill Payment regulatory data. The adoption of these copyrighted IAIABC standards has been widespread, with 38 states currently using at least one IAIABC EDI standard.
When the IAIABC EDI program was instituted, the workers' compensation industry recognized the value of standardization and agreed to provide the program funding.
The current funding model, EDI membership, is a voluntary program for IAIABC EDI members to support EDI standards development. However, although the workers' compensation industry as a whole benefits from the standards, the cost of the EDI program is not equitably shared but is borne by the EDI membership. Consequently, the IAIABC Executive Committee has authorized a licensing program to protect the IAIABC’s copyrighted standards, to provide ongoing and sustainable support for the program, to spread the costs more equitably among users of the standards, and to encourage IAIABC EDI membership. This program began in 2011.
Following is general information about the EDI licensing program.
Who is subject to EDI license fees?
A licensee is any organization that uses an IAIABC EDI standard to send workers' compensation data to a state regulatory agency on behalf of an unaffiliated third party. Meaning, the licensee is sending data to the state regulatory agency that has been generated by a third party (i.e. an insurer). This will typically include organizations that are listed on a state trading partner list that fall into any of the following categories: vendor, service provider, and third party administrator.
Insurers reporting their own policy-holders' data or self-insured employers reporting their own employee data to the regulatory agency using IAIABC EDI standards will not be subject to license fees.
What EDI standards are being licensed?
The IAIABC is licensing First and Subsequent Reports of Injury (Releases 1 and 3); Proof of Coverage; and Medical Bill Payment Reporting EDI standards.
Do IAIABC EDI members have to pay license fees?
No, EDI members will not have to pay EDI licensee fees. License fees will be included in the cost of membership. However, IAIABC Corporate and Individual members will be subject to license fees. To learn more about EDI membership, click here.
Why are insurers and self-insured employers not subject to license fees?
Insurers and self-insured employers that report their own data to the state regulatory agency using IAIABC EDI standards are not subject to license fees. This is because they are using the EDI standards as part of their business practice, and are not charging their customers additional fees to send data using the standards.
How is the IAIABC EDI program currently funded? Why has the IAIABC decided to license its standards?
The IAIABC EDI program is funded primarily through EDI member dues. Over 60 organizations currently support the IAIABC and EDI program through member dues. While the time and financial support these members provide is incredibly valuable, it is not enough to adequately fund the continued maintenance and development of EDI standards, and the costs are not being equitably shared among the organizations that are using the standards. The EDI licensing program will provide continued, sustainable support for these standards.
How are the license fees determined?
License fees are determined on a per-state, per standard basis. For the first state a licensee reports to, there is an annual $150 licensee fee for each standard the licensee uses. For each additional state the licensee reports to using the same standard, there is a $100 license incurred.
For instance, if an organization reports data to five (5) states using one (1) standard, the organization's annual license fee will be $550. If an organization reports data to one (1) state using the Medical standard and three (3) states using the Claims Release 1 standard, the licensee will be $450.
When will the IAIABC send invoices/bills for license fees?
Invoices for licenses will be sent in June each year. Licenses will be in effect for July 1 through June 30.
If my company elects to become an EDI member, what benefits would my company receive in additional to having our license fee included in our EDI member dues
There are many benefits to EDI membership. To learn more, click here.
What will the licensing revenue be used for?
Revenue from the EDI licensing program will be used primarily to support the EDI program and continued maintenance and development of the EDI standards. Some areas where funds might be used include improved technology for EDI meetings; additional technical assistance to implementing jurisdictions and EDI members; and developing EDI training and educational content.
If you have additional questions that were not answered here, please contact Keri Lore at email@example.com.