Our last blog post on the revenue cycle journey looked at clearinghouse edits. The next stop in the medical claims process is payer adjudication. Payer adjudication is when a third-party payer receives your medical claim and starts the review process. The payer decides, based on the information you provide, whether the medical claim is valid and should be paid. Expect payers to review claims meticulously. They want to be assured that you have all the records needed to back them up, especially for high-dollar claims. Healthcare payers use a specific file format—the EDI 277 Health Care Claim Status Response transaction set—to report on the status of medical claims. The 277-file generated by the clearinghouse indicates whether the payer has accepted your claim and can be automatically loaded into your practice management (PM) system.