Denial code reference with recovery paths
Claim Adjustment Reason Codes (CARCs) are the standard codes on a remittance that say why a line was adjusted or denied. A small set of them accounts for most aged medical A/R. This table gives the meaning and the first recovery action for each. Group codes: CO is contractual obligation (provider cannot bill the patient), PR is patient responsibility.
| Code | Meaning | Recovery path |
|---|---|---|
| CO-4 | Procedure code inconsistent with the modifier used, or a required modifier is missing | Corrected claim with the right modifier |
| CO-11 | Diagnosis inconsistent with the procedure | Review coding; corrected claim or appeal with documentation |
| CO-16 | Claim lacks information or has a submission/billing error (see RARC for the field) | Correct the identified field and resubmit; not appealable as-is |
| CO-18 | Duplicate claim or service | Verify the original claim's status; if the original was denied, work that one |
| CO-22 | Care may be covered by another payer per coordination of benefits | Verify primacy; bill the primary, then rebill with the primary EOB |
| CO-27 | Expenses incurred after coverage terminated | Confirm eligibility for the date of service; bill the correct plan or patient |
| CO-29 | Time limit for filing has expired | Appeal with proof of timely filing (clearinghouse acceptance, payer acknowledgment) |
| CO-45 | Charge exceeds fee schedule or contracted maximum allowable | Contractual adjustment unless the allowed amount is below contract; then underpayment dispute |
| CO-50 | Non-covered because not deemed a medical necessity by the payer | First-level appeal with records, policy citation, and letter of medical necessity |
| CO-96 | Non-covered charge(s) | Check the RARC; appeal if the service is a covered benefit, else patient responsibility per plan |
| CO-97 | Benefit for this service is included in the payment for another service (bundled) | Review NCCI edits; corrected claim with modifier if separately reportable, else adjust |
| CO-109 | Claim not covered by this payer or contractor; send to the correct payer | Identify the correct payer (e.g., MA plan vs. MAC) and refile within its limit |
| CO-197 | Precertification, authorization, or notification absent | Retro-authorization where allowed; otherwise appeal with clinical documentation |
| CO-198 | Precertification, authorization, or notification exceeded | Appeal with documentation of the additional units or services |
| CO-B7 | Provider was not certified or eligible to be paid for this procedure on this date | Credentialing check; refile after effective date or appeal with enrollment proof |
| PR-1 / PR-2 / PR-3 | Deductible, coinsurance, copay (patient responsibility) | Not an insurance recovery item; verify the amount against the EOB before billing the patient |
Meanings are paraphrased from the X12 code list; the RARC on the same line usually names the specific field or policy. Always read both.
Using the table on an aging report
- Cut the 90+ day insurance balance by CARC. The top three codes usually explain most of the balance.
- CO-16 and CO-4 are corrections, not appeals: fast, high-yield, and often caused by one upstream setting.
- CO-197, CO-50, and CO-198 are appeals with documentation: slower, higher value, and deadline-bound.
- CO-29 is only closed when there is no proof of timely filing. Check the clearinghouse report first.
- CO-45 hides underpayments: compare the allowed amount to the contract before accepting it as an adjustment.
Sources
- X12, Claim Adjustment Reason Codes (the maintained code list)
- CMS, National Correct Coding Initiative (NCCI) edits
- CMS, Medicare timely filing requirements
Figures attributed to a source are that source's; commonly used benchmarks are labeled as such. Verify deadlines against your own payer contracts.