EDI Service Provider
Top Differences Between ANSI X12 and UN/EDIFACT: A Complete Rundown
EDI, Electronic Data Interchange, is now the most popular and widely used method for businesses to communicate. From small enterprises to large corporations, almost all organizations across the world are relying on EDI integration services. We know that to run a business and interact with trading partners, it is important to exchange and process a large number of documents on a daily business. Of course, paper-based methods or manual processes cannot accomplish these tasks effectively, and even if they could, it is time-consuming and involves higher chances of errors. Hence, EDI, an automated and electronic mode that is faster and more efficient.
In the world of EDI, the two most common standards that are used in varied industries are ANSI ASC X12 and EDIFACT. Both these EDI standards are used to send and receive business documents electronically between trading partners. Although both of them are quite similar, there are numerous differences between them as well which make them different.
In this blog, we are going to understand these standards in detail and compare them based on various factors:
A Brief Introduction to EDI X12
EDI is a flat-file technology or format that is used by business or trading partners in different organizations to securely share business transactions, information, or file. The EDI X12 format is based on ASC, Accredited Standards Committee, X12 standards. After the documents are prepared according to ASC X12 data standards, it is then translated into a common language used by organizations and sent through a point-to-point secure EDI connection. The protocols used for this format includes FTP, API-based systems, such as AS4, web-based via AS2, etc. This standard was further segregated into substandards or formats for easier and quicker information exchange. Additionally, every industry vertical was leveraged to use ANSI X12 with a dedicated format to transmit a specific type of data. Such as for healthcare, below are a few formats that were regulated to follow -
These standards were -
- EDI 834 - Benefit Enrollment and Maintenance
- EDI 837- Healthcare Claim Transaction Set
- EDI 835 - Healthcare Claim Payment/Advice
- EDI 270/271 - Healthcare Eligibility, Coverage or Benefit and Information Response
- EDI 278 - Healthcare Services Review - Request for Review and Response
- EDI 820 - Payroll Deducted and Other Group Premium Payment for Insurance Products
Apart from businesses that use X12 to send and receive EDI documents and files, such as invoices, purchase orders, and more, this EDI solution is also used across various industries, which include insurance, healthcare, e-commerce for audit trails. It ensures security along with features, such as automation, cost-saving, and time-effectiveness. Moreover, it offers a common language to exchange information between two or more organizations and mitigates risks associated with paper-based and email data transmission.
A Brief Introduction to EDIFACT
EDIFACT stands for Electronic Data Interchange for Administration, Commerce, and Transport. It is an international EDI standard developed under the United Nations so that EDI is structured to work for multi-country and multi-industry exchange.
EDIFACT is used by organizations, both commercial and governmental, to transmit information using a common language. It is commonly used in Europe and many businesses in the US and the Asia Pacific regions have also started adopting this EDI standardized process for secure data exchange.
Differences Between X12 and EDIFACT
The first difference that our EDI experts will discuss between these two EDI standards is the geographical location of users.
- X12 was developed by the American National Standards Institute and is mainly used in North America transaction sets.
- EDIFACT was developed by the United Nations Economic Commission and is widely used by companies based in Asia and Europe.
- ANSI X12 is particularly used in the healthcare industry to ensure HIPAA compliance in the healthcare documents.
- On the other hand, EDIFACT is not used for HIPAA documents but is popular in other industries, such as government, supply chain, finance, etc.
- ANSI ASC X12 EDI standard is developed and maintained by Accredited Standards Committee X12 also known as ASC X12 and chartered by the ANSI in 1979.
- Electronic Data Interchange for Administration, Commerce, and Transport or EDIFACT is supported by two international organizations - The United Nations Economic Commission for Europe (UNECE) and the International Organization for Standardization (ISO).
Both EDI standards use special characters to separate segments and elements in the documents.
- ANSI X12’s interchange header is marked ISA and it generally uses a tilde (~) to separate segments and an asterisk (*) to terminate elements.
- EDIFACT’s interchange header is marked as UNB. It uses a period or dot (.) between segments to separate them and a (+) sign between elements. However, both of them can use different characters as well based on the specific implementation.
The list below shows key ANSI X12 transactions with corresponding EDIFACT messages.
Advance Ship Notice (or Dispatch Advice in EDIFACT)
Although the message structures of X12 and EDIFACT are similar, both use different terminologies. Messages in both EDI data formats include elements, namely Transaction Set, Functional Group, Interchange, and EDI Document.
Here is how our EDI managed services provider explains differences -
Transaction Set and Message: This is the main body of the message like order details in a purchase order. It is called a Transaction Set in X12 while a message in EDIFACT.
The Functional Group: It is the header that specifies where the message will go, such as a company department. There can be multiple messages or transaction sets like invoices and PO. for both the EDI standards, there is a header and a footer segment. X12 uses GS and GE for the header and footer respectively. EDIFACT uses UNG and UNE for header and footer.
The Interchange: It includes a header and footer and specifies the recipient company of the message or document. The former calls the header ISA and the footer IEA. The latter uses UNB and UNZ for them.
The EDI Document: This is an optional segment used in EDIFACT to define characters for terminators and separators in the document.
Composite Elements comprises two or more elements that are similar to an array and separated by a composite separator symbol. They are available in both standards. However, they are rarely used in EDI ANSI X12 and are common in EDIFACT.
The former uses Greater Than ( > ) to separate elements while the latter delimits them with a colon (:).
Security authentication is available for both X12 and EDIFACT but they support different standards.
The former uses ASC X12.58 security structures that include compression, authentication, encryption, and assurance to make sure that the EDI files reach their destination in the original format. It monitors that there is no tampering with the files and assures the recipient of the original sender.
- ISO 9735-5 to address message, group, and interchange level security for integrity, authenticity, and non-repudiation of origin.
- ISO 9735-6 defines authentication and acknowledgment message AUTACK.
- ISO 9735-7 addresses group, message or package, and interchange level security for confidentiality.
- ISO 9735-9 is for the security key and certificate management message KEYMAN.
Now that you are familiar with key differences between EDI X12 and EDIFACT, we are sure that it will help you select the right solution for your business. We understand that both the standards are a bit complicated to comprehend completely and you still may have many queries before you make your decision. Hence, A3logics, a trusted enterprise software development company, is here with its team of EDI professionals and consultants who will guide you throughout the process. Feel free to connect with them via phone call or email and they will be in touch with you at the earliest.
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