Common Denial Codes in Medical Billing

CO22 – This procedure, service, or supply is not covered when performed, referred, or ordered by this provider

This denial code often appears when a service is provided by an out-of-network provider or when the referring physician is not recognized by the insurance plan.

To prevent this denial:

• Verify the patient’s insurance coverage and network status before providing services
• Ensure that all referring physicians are properly credentialed and recognized by the payer
• Educate patients about their insurance plan’s network restrictions

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CO24 – Charges are covered under a capitation agreement/managed care plan

This denial occurs when a service should be covered under a capitated or managed care arrangement rather than billed separately.

To address this issue:

• Review and understand all capitation agreements with payers
• Implement a system to flag capitated services before billing
• Train staff on the specifics of each managed care contract

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CO27 – Expenses incurred after coverage terminated

This denial indicates that the service was provided after the patient’s insurance coverage had ended.

To minimize these denials:

• Verify insurance eligibility at each patient visit
• Implement a system to track and update patient insurance information regularly
• Educate patients on the importance of keeping their insurance information current

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CO31 – Patient cannot be identified as our insured

This denial suggests that the patient information submitted doesn’t match the insurance company’s records.

To prevent this:

• Double-check patient demographic information at each visit
• Use insurance card scanners to reduce data entry errors
• Implement a system to verify patient identity and insurance information

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CO32 – Our records indicate that this dependent is not an eligible dependent as defined

This denial occurs when a claimed dependent doesn’t meet the eligibility criteria set by the insurance plan.

To address this:

• Verify dependent eligibility during the registration process
• Keep detailed records of dependent information and update regularly
• Educate patients on their plan’s dependent coverage rules
  

CO11 – The diagnosis is inconsistent with the procedure

This denial indicates that the diagnosis code submitted doesn’t support the need for the procedure or service billed.

To prevent this:

• Ensure coders are trained on proper code linkage
• Implement coding software that flags potential mismatches
• Regularly audit coding practices to identify and correct patterns of errors

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CO16 – Claim/service lacks information or has submission/billing error(s)

This is a general denial code that suggests the claim is missing crucial information or contains errors.

To address this:

• Implement a claim scrubbing process to catch common errors before submission
• Provide ongoing training to staff on proper claim submission procedures
• Regularly review and update your billing software to ensure compliance with current requirements

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CO18 – Exact duplicate claim/service

This denial occurs when a claim is submitted more than once for the same service on the same date.

To prevent duplicate submissions:

• Implement a tracking system for submitted claims
• Train staff to check for existing claims before resubmitting
• Regularly audit your billing process to identify patterns of duplicate submissions

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CO97 – The benefit for this service is included in the payment/allowance for another service/procedure that has already been adjudicated

This denial, often referred to as “bundling,” occurs when a separate charge is submitted for a service that should be included as part of another procedure.

To address this:

• Stay updated on current bundling rules and regulations
• Use coding software that flags potential bundling issues
• Provide regular training to coders on proper unbundling techniques

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CO234 – This procedure is not paid separately

Similar to CO97, this denial indicates that the service should not be billed separately.

To prevent this:

• Familiarize billing staff with payer-specific billing guidelines
• Implement coding software that identifies services typically not paid separately
• Regularly review and update charge capture processes
  

CO50 – These are non-covered services because this is not deemed a “medical necessity” by the payer

This common denial occurs when the payer determines that the service provided was not medically necessary.

To address this issue:

• Ensure thorough documentation of medical necessity in patient records
• Familiarize providers with payer-specific medical necessity criteria
• Implement a pre-authorization process for services commonly denied for medical necessity

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CO55 – Procedure/treatment/drug is deemed experimental or investigational by the payer

This denial is used when the payer considers the service to be experimental or not yet proven effective.

To minimize these denials:

• Stay informed about current accepted medical practices and payer policies
• Obtain pre-authorization for any treatments that might be considered experimental
• Provide comprehensive documentation supporting the use of new or experimental treatments

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CO56 – Procedure/treatment has not been deemed “proven to be effective” by the payer

Similar to CO55, this denial suggests that the payer doesn’t recognize the treatment as an established, effective option.

To address this:

• Keep abreast of the latest clinical research and payer policies
• Provide robust documentation supporting the efficacy of the treatment
• Consider appealing denials with peer-reviewed literature supporting the treatment

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CO119 – Benefit maximum for this time period or occurrence has been reached

This denial indicates that the patient has exhausted their coverage for a particular service.

To prevent this:

• Track patient benefit usage throughout the year
• Educate patients about their benefit limits and usage
• Implement a system to alert providers when a patient is approaching benefit limits

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CO150 – Payer deems the information submitted does not support this level of service

This denial suggests that the documentation doesn’t justify the level of service billed.

To address this:

• Provide thorough training on proper documentation techniques
• Implement regular audits of documentation and coding practices
• Use electronic health record (EHR) templates that prompt for necessary documentation elements
  

CO109 – Claim/service not covered by this payer/contractor. You must send the claim/service to the correct payer/contractor

This denial occurs when a claim is submitted to the wrong insurance company.

To prevent this:

• Implement a robust insurance verification process
• Train front-desk staff on identifying and verifying correct payer information
• Use electronic eligibility verification tools to ensure accurate payer information

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CO133 – The disposition of this service line is pending further review

This code indicates that the payer needs more time or information to process the claim.

To address this:

• Follow up with the payer to determine what additional information is needed
• Implement a system to track and follow up on pending claims
• Ensure all necessary documentation is submitted with the initial claim

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CO197 – Precertification/authorization/notification absent

This denial occurs when a required pre-authorization was not obtained before providing the service.

To prevent this:

• Implement a robust pre-authorization process
• Train staff on payer-specific pre-authorization requirements
• Use software that tracks and manages pre-authorization requests and approvals

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CO204 – This service/equipment/drug is not covered under the patient’s current benefit plan

This denial indicates that the service provided is not included in the patient’s insurance plan.

To minimize these denials:

• Verify coverage details during the insurance verification process
• Educate patients about their coverage and potential out-of-pocket costs
• Implement a system to flag non-covered services before they are provided

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CO252 – An attachment/other documentation is required to adjudicate this claim/service

This denial suggests that additional documentation is needed to process the claim.

To address this:

• Implement a system to ensure all necessary documentation is submitted with the initial claim
• Train staff on payer-specific documentation requirements
• Regularly audit claims to identify patterns of missing documentation
  

Here are some key strategies to consider:

Implement a Robust Verification Process

One of the most effective ways to prevent denials is to implement a thorough insurance verification process.

This should include:

• Verifying patient eligibility and benefits before each visit
• Confirming coverage details, including any limitations or exclusions
• Checking for any pre-authorization requirements
• Updating patient information regularly

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Invest in Staff Training

Ongoing education and training for your billing staff is crucial.

This should include:

• Regular updates on coding changes and payer policies
• Training on proper documentation techniques
• Education on common denial reasons and prevention strategies
• Workshops on effective communication with payers and patients

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Utilize Technology

Leveraging technology can significantly improve your billing accuracy and efficiency.

Consider:

• Implementing claim scrubbing software to catch errors before submission
• Using electronic eligibility verification tools
• Adopting an EHR system with built-in coding and billing features
• Implementing analytics tools to track denial patterns and identify areas for improvement

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Establish a Denial Management Process

Having a structured process for handling denials can improve your resolution rate and speed.

This process should include:

• Prompt review and categorization of denials
• Assignment of denials to appropriate staff members for follow-up
• Tracking of denial resolution progress
• Regular analysis of denial trends to inform process improvements

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Improve Documentation Practices

Many denials can be prevented or successfully appealed with proper documentation.

Encourage providers to:

• Document thoroughly, including all relevant details to support medical necessity
• Use specific, precise language in their notes
• Link diagnoses clearly to treatments provided
• Keep up-to-date with documentation requirements for different payers

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Conduct Regular Audits

Internal audits can help identify and address issues before they result in denials.

Consider:

• Conducting regular coding audits to ensure accuracy
• Reviewing claims before submission to catch potential issues
• Analyzing denied claims to identify patterns and areas for improvement
• Performing periodic reviews of your entire revenue cycle process

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Foster Communication Between Departments

Effective communication between clinical and billing staff can prevent many denials.

Encourage:

• Regular meetings between coding, billing, and clinical staff
• Clear channels for communicating about complex cases or potential billing issues
• Collaborative problem-solving when denials occur

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Develop Strong Payer Relationships

Building good relationships with your major payers can be beneficial.

Consider:

• Regularly communicating with payer representatives
• Attending payer-provided training sessions
• Providing feedback to payers about unclear policies or recurring issues
• Negotiating contracts with clear terms and expectations

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Educate Patients

Patient education can play a significant role in preventing denials.

Make sure to:

• Inform patients about their insurance coverage and limitations
• Explain any potential out-of-pocket costs before providing services
• Encourage patients to keep their insurance information up-to-date
• Provide clear explanations of billing processes and patient responsibilities

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Implement a Strong Appeals Process

Despite best efforts, some denials will occur. Having a robust appeals process can help recover lost revenue.

This should include:

• Prompt identification of appealable denials
• Collection of all necessary documentation to support the appeal
• Clear, concise appeal letters that address the specific reason for denial
• Tracking of appeal outcomes to inform future strategies