Look up any CARC denial reason code. Understand what it means, why it happens, and exactly how to resolve and prevent it.
27 codes found
The procedure code billed is not consistent with the modifier used, or the procedure code is not valid for the date of service. This is one of the most common coding-related denials and usually indicates a mismatch between the CPT/HCPCS code and the modifier appended to it.
The diagnosis code(s) submitted on the claim are not consistent with the procedure code billed. The payer has determined that the diagnosis does not support the medical necessity of the procedure performed. This is an extremely common denial that often results from incorrect ICD-10 code selection.
The procedure or service requires prior authorization from the payer, but no authorization was obtained before the service was rendered, or the authorization on file does not match the claim. This is one of the most preventable -- and most costly -- denial codes in healthcare.
The claim or service lacks information that is needed for adjudication. Additional information is required from the provider before the payer can process this claim. This is one of the most common denial codes and is often a catch-all for missing data elements.
The payer has identified this claim or service line as a duplicate of a previously submitted and adjudicated claim. This means the exact same service for the same patient on the same date of service has already been processed.
The service may be covered by a capitated or managed care arrangement. The payer believes that another entity is financially responsible for this service under a capitation or risk-sharing agreement.
The patient's insurance coverage was not active on the date of service. The service was performed after the patient's coverage termination date. This denial means the patient had no active insurance with this payer when the service occurred.
The claim was not submitted within the payer's timely filing deadline. Each payer sets a specific window (typically 90-365 days from the date of service or date of denial) within which claims must be submitted. Once this window closes, the claim cannot be paid regardless of its validity.
The billed amount exceeds the payer's fee schedule, contracted rate, or maximum allowable amount. The payer is adjusting the charge to their allowed amount. This is technically an adjustment rather than a true denial -- the claim is being paid, but at the contracted rate.
The payer has determined that the service is not covered because it is not medically necessary based on the diagnosis, clinical information, or coverage policy. This is a medical necessity denial, meaning the payer does not believe the clinical evidence supports the service performed.
The service is not covered under the patient's benefit plan. Unlike CO-50 (which is a medical necessity denial), CO-96 means the service is categorically excluded from the patient's insurance benefits regardless of medical necessity.
This procedure or service has already been paid. The payer records show a prior claim for the same procedure, same patient, same date of service has already been adjudicated and paid. This is similar to CO-18 (duplicate) but specifically indicates payment was already issued.
The claim has been denied because this payer is not responsible for coverage. The service should be billed to a different insurance company. This often occurs in coordination of benefits situations where the wrong payer was billed as primary.
This diagnosis code or procedure code is not a covered benefit for the patient's specific insurance plan. While the payer may cover this service on other plans, it is excluded or not included in the patient's particular plan type.
A required precertification, authorization, or notification was not obtained for this service. This is closely related to CO-15 but specifically references the absence of precertification or notification rather than a mismatch with an existing authorization.
The procedure code or revenue code submitted on the claim is not valid. The code may not exist, may have been deleted from the code set, or may be invalid for the date of service.
The service was provided by a non-network or non-primary care provider. The patient's plan requires services to be rendered by in-network providers or requires a referral from a primary care provider.
The payer is requesting additional information before the claim can be processed. The claim is being held pending receipt of the requested documentation. This is not a final denial but a request for more information.
The patient is responsible for the deductible amount on this claim. The service is covered, but the patient has not yet met their annual deductible, so the allowed amount (or portion of it) is being applied to the patient's deductible.
The patient is responsible for the coinsurance amount on this claim. After the deductible is met, the patient owes their coinsurance percentage (commonly 10-40%) of the allowed amount.
The patient is responsible for the copay amount for this visit or service. The copay is a fixed dollar amount the patient owes for a covered service, as defined by their insurance plan.
The service is not covered under the patient's plan and the full charge is the patient's responsibility. Unlike CO-96 (which is a contractual write-off), PR-96 means the patient can be billed for the full amount.
The service or procedure is not covered or not authorized under the patient's current benefit plan. The full charge is the patient's responsibility.
This is a duplicate claim adjustment categorized under Other Adjustment. The claim has been identified as a duplicate of a previously processed claim. The OA group code indicates neither the provider nor the patient is responsible for the adjustment.
The payment or adjustment is based on how the prior (primary) payer adjudicated the claim. This is common when billing secondary insurance -- the secondary payer's payment is influenced by what the primary payer paid or denied.
The payer has initiated this adjustment because prior authorization was required but not obtained. The PI group code indicates this is a payer-initiated reduction, meaning the provider may have limited appeal rights depending on the contract.
The procedure or service has been bundled into (included with) another service that was billed on the same claim or same date of service. National Correct Coding Initiative (NCCI) edits or payer-specific bundling rules determined that this service is included in a more comprehensive procedure.
Claim Adjustment Reason Codes (CARCs) are standardized codes used by health insurance payers to explain why a claim was adjusted or denied. Understanding these codes is essential for effective denial management.
Adjustments resulting from the provider's contract with the payer. The provider is responsible for the write-off and cannot bill the patient for these amounts. These are the most common denial group codes.
Amounts that are the patient's financial responsibility, including deductibles, copays, and coinsurance. These are not denials per se -- they indicate the patient owes the money.
Adjustments where neither the provider nor the patient bears financial responsibility. Common in coordination of benefits situations and when the adjustment relates to another payer's actions.
Reductions initiated by the payer, often related to medical policy or utilization management decisions. These may have different appeal rights than standard contractual denials.
According to industry data, the most frequently encountered denial codes are CO-16 (missing information), CO-15/CO-197 (missing authorization), CO-4 (coding errors), CO-11 (diagnosis mismatch), CO-50 (medical necessity), and PR-1/PR-2/PR-3 (patient responsibility). Together, these codes account for the vast majority of all claim adjustments. Most are preventable with proper pre-visit verification and automated PA workflows.
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