Denial codes in medical billing: The top 20 CARC codes and how to fix them
The denial codes billers see most, what each CARC code means, and how to fix it ...
Last Updated: August 17, 2026
Key takeaways
Denial codes are Claim Adjustment Reason Codes, or CARCs, the standard set payers use to say why a claim was denied or paid differently.
Every CARC arrives with a group code. CO means the practice absorbs the amount, and PR means you can bill the patient.
The codes reach you on the electronic remittance advice, or ERA, and on the paper explanation of benefits.
The right response differs by code, from a corrected claim to an appeal, a patient statement, or a write-off.
A one-page cheat sheet covering all 20 codes is free to download below.
Download your free denial code cheat sheet
A one-page PDF listing all 20 codes with the official X12 meaning, the usual cause, and the first action to take. It also carries a key to the CO, PR, OA and PI group prefixes, the four response routes, and a worked ERA example. Sized to print and pin at the billing desk.
Download templateDenial codes in medical billing are Claim Adjustment Reason Codes, or CARCs. Payers use this standard set to explain why a claim was denied, or paid differently from the way you billed it.
The code is an instruction. Read it properly and it tells you whether to correct the claim, appeal it, bill the patient, or simply write the money off. Read it wrong and you either resubmit something that will be denied again, or you write off cash you were owed.
Every definition below is the official X12 wording, checked against the X12 code list at the time of writing. That matters more than it sounds. Payer and contractor pages routinely paraphrase these definitions, and the paraphrase quietly shifts what the code is telling you.
How denial codes work: CARC, RARC and the group codes
Two code sets do the job together. The CARC gives the reason for an adjustment and moves the money. The Remittance Advice Remark Code, or RARC, adds the supporting detail and moves nothing on its own.
That pairing is not optional. CMS states that some CARCs are too generic to communicate the reason without at least one remark code, and requires contractors to send one. CO-16 is the obvious case: on its own it tells you only that something is missing.
Each CARC also travels with a two-letter group code, and that prefix is the part that decides who absorbs the amount.
| Prefix | Official name | Who absorbs the amount | Example |
|---|---|---|---|
| CO | Contractual Obligation | The practice. It is a write-off, and billing the patient for it breaches your contract. | CO-45, charge exceeds the fee schedule |
| PR | Patient Responsibility | The patient. This is the amount you can put on a statement. | PR-1, deductible amount |
| OA | Other Adjustment | Neither. It is used when no other group code applies. | OA-18, exact duplicate claim/service |
| PI | Payor Initiated Reduction | The payer, under its own policy rather than your contract. | Not valid on Medicare, which uses only CO, OA and PR |
One detail catches people out. X12 defines the number, and the payer applies the prefix when the claim adjudicates. So the same reason code can arrive as CO on one remittance and PR on another. Code 45 says as much in its own usage note, which limits it to CO or PR depending on liability.
The top 20 denial codes and how to resolve each
Commercial payers do not publish how often each CARC fires, but Medicare contractors do. This list is built from three of them. It is then rounded out with the contractual and patient-responsibility adjustments that land on almost every remittance.
Novitas Solutions ranks 18, 22, 26, 29, 50, 96, 97, 109, 170, B9 and B15 as its top claim denials for April to June 2026. First Coast names 22, 97, 50, B7 and 18 as top denials, and 4, 16, 24, 109 and 181 as top unprocessable rejections. CGS publishes denial counts for Kentucky and Ohio that tell the same story.
| Code | Official X12 meaning | What usually went wrong | First action |
|---|---|---|---|
| PR-1 | Deductible Amount | The patient has not met their deductible yet. | Bill the patient for the amount shown. |
| PR-2 | Coinsurance Amount | The patient’s percentage share of the allowed amount. | Bill the patient, or the secondary payer if there is one. |
| PR-3 | Co-payment Amount | The flat per-visit fee the plan charges. | Bill the patient, or reconcile it against the copay taken at check-in. |
| CO-4 | The procedure code is inconsistent with the modifier used. | A required modifier is missing, or the one you sent is not valid with that CPT code. | Fix the modifier and resubmit. Medicare returns these unprocessable, so send a new claim rather than an appeal. |
| CO-11 | The diagnosis is inconsistent with the procedure. | The ICD-10 code on the claim does not support the procedure you billed. | Recode from the chart, then send a corrected claim. |
| CO-16 | Claim/service lacks information or has submission/billing error(s). | A required field is missing or invalid. The paired remark code names which one. | Read the remark code, fix that field, resubmit. With MA130 there are no appeal rights. |
| OA-18 | Exact duplicate claim/service | The same service, date and provider were billed twice. | Check claim status first. If the original paid, post it and close the duplicate. |
| CO-22 | This care may be covered by another payer per coordination of benefits. | Another plan is primary and has not paid yet. | Bill the primary payer, then resubmit with its remittance attached. |
| CO-27 | Expenses incurred after coverage terminated. | The patient’s policy had ended on the date of service. | Check for a replacement policy. If there is none, bill the patient. |
| CO-29 | The time limit for filing has expired. | The claim missed the payer’s filing deadline. | Appeal only if you can prove timely submission. Otherwise write it off. |
| CO-45 | Charge exceeds fee schedule/maximum allowable or contracted/legislated fee arrangement. | Your charge sits above the contracted rate. This is the normal contractual adjustment, not a denial. | Post the write-off and move on. Never bill the patient for a CO amount. |
| CO-50 | These are non-covered services because this is not deemed a ‘medical necessity’ by the payer. | The payer’s coverage policy was not met, or the diagnosis did not support the service. | Appeal with chart notes, or bill the patient if you hold a signed waiver. |
| CO-96 | Non-covered charge(s). | The plan excludes the service outright. | Read the remark code. If it is excluded by law or contract, bill the patient. |
| CO-97 | The benefit for this service is included in the payment/allowance for another service/procedure that has already been adjudicated. | The service bundles into another one you billed the same day. | Check the bundling edits. Appeal with a modifier only where the service was genuinely separate. |
| CO-109 | Claim/service not covered by this payer/contractor. You must send the claim/service to the correct payer/contractor. | Wrong payer. The patient has a different plan or a different contractor. | Re-verify eligibility, then submit to the correct payer. |
| CO-151 | Payment adjusted because the payer deems the information submitted does not support this many/frequency of services. | You billed more units or visits than the policy allows. | Appeal with documentation supporting the volume, or write off the excess. |
| CO-167 | This (these) diagnosis(es) is (are) not covered. | The diagnosis itself sits outside the plan’s coverage. | Confirm the diagnosis is coded correctly. If it is, bill the patient. |
| CO-197 | Precertification/authorization/notification/pre-treatment absent. | No prior authorization was on file when the claim processed. | Request a retroactive authorization. If the payer refuses, appeal or bill per your contract. |
| PR-204 | This service/equipment/drug is not covered under the patient’s current benefit plan | The plan simply does not include this benefit. | Bill the patient, provided your financial policy and waiver cover it. |
| CO-252 | An attachment/other documentation is required to adjudicate this claim/service. | The payer wants records before it will decide. | Send the requested documentation with a corrected claim. This is not an appeal. |
The second column is X12’s own wording, verbatim. Several of these codes cannot stand alone, so the payer must send a remark code with them. That remark code is where the missing field, the coverage policy, or the specific document actually gets named.
CO-16: the code that needs a second code to make sense
CO-16 tells you a field is wrong and nothing else. The remark code beside it does the real work, naming the rendering provider identifier, the patient identifier, the CLIA number, or whichever element failed.
Watch for remark code MA130. It says the claim is unprocessable and no appeal rights are afforded, so the only route is a fresh claim with the correct information. Appealing an MA130 wastes the days you have left on the filing clock.
CO-29: the deadline you can sometimes still beat
CO-29 means the filing limit ran out. Medicare gives you 12 months from the date of service, and commercial limits are usually shorter and set by your contract.
An appeal only works if you can show the claim reached the payer in time. A clearinghouse acknowledgment carrying the original submission date is the evidence that wins these. Without it, this is a write-off, and the money is gone.
CO-97: bundling, and when a modifier is honest
CO-97 means the payer has already paid for this service inside another one. Most of the time that is correct and the line is a write-off.
It is worth challenging when the two services were genuinely separate, or when the visit fell outside a global surgical period. That argument needs a modifier and documentation that supports it. Adding a modifier purely to unbundle a legitimately bundled pair is a compliance problem, not a fix.
CO-50: medical necessity is a policy argument
CO-50 is a coverage decision, so the appeal is against a policy rather than a data error. Medicare denials usually arrive with remark code N115, which points at the Local Coverage Determination behind the decision.
Pull that policy, find the covered indications, and appeal with the chart notes that meet them. If the service was never going to be covered, a signed waiver taken before treatment is what lets you bill the patient instead.
CO-252: send documents, not an appeal
CO-252 is the payer pausing rather than refusing. It wants an operative report, an invoice, or another attachment before it will adjudicate.
Send what was asked for with a corrected claim. Filing an appeal here restarts a process the payer has not finished, and usually adds weeks for no reason.
Reading denial codes on an ERA
Denial codes reach you on the electronic remittance advice, the 835 file a medical claims clearinghouse posts back once the payer has adjudicated. Every adjustment on it carries a group code, a reason code, and the amount involved.
Remark codes sit separately. CMS requires service-line remarks in the 835’s LQ segment, and claim-level remarks in the MOA segment for non-inpatient claims or MIA for inpatient. Your billing software usually shows them side by side, which is how the pair should be read.
Here is one real Medicare denial, unpacked field by field.
| Field | Value | What it tells you |
|---|---|---|
| Group code | CO | Contractual. The practice absorbs it, and the patient cannot be billed. |
| Reason code (CARC) | 50 | Non-covered because the payer does not deem it a medical necessity. |
| Remark code (RARC) | N115 | The decision came from a Local Coverage Determination, which you can look up. |
| Adjustment amount | $180.00 | The dollars this single adjustment moved off the line. |
Read together, those four fields say one thing. Medicare denied the line under a published coverage policy, you are holding the balance, and that policy is where an appeal starts.
Corrected claim, appeal, or write-off? Choosing the response
The group code narrows the choice and the reason code settles it. Four routes cover almost every denial you will work.
Send a corrected claim
When the data was wrong or incomplete.
CO-4, CO-11, CO-16, CO-252. Resubmit electronically with claim frequency code 7 to replace the original, or 8 to void it, quoting the original claim number.
File an appeal
When you disagree about coverage or necessity.
CO-50, CO-97, CO-151, CO-197. Attach the chart notes or policy language that answer the payer’s stated reason. Argue the decision, not the paperwork.
Bill the patient
When the adjustment carries a PR group code.
PR-1, PR-2, PR-3, PR-204. Put it on a statement. A CO amount never belongs here, and billing one to a patient breaches your payer contract.
Post the write-off
When the adjustment is contractual or the deadline has gone.
CO-45, and CO-29 without proof of timely filing. Close the balance and move to the next claim. Chasing these costs more than it recovers.
Corrections and appeals are separate processes, and mixing them up is the most expensive mistake on this page. CMS is explicit that Medicare contractors do not handle claim corrections involving minor errors and omissions through the appeals process.
Deadlines run underneath all four routes. For Medicare, you have 120 days from receipt of the initial determination to request a redetermination. The notice is presumed received five calendar days after its date. Commercial appeal windows are set by contract and are often tighter.
How Pabau keeps the denial reason on the claim record
The workflow most practices end up with splits the denial in half. The code sits in a payer portal or a remittance PDF, and the claim sits in the practice system. Someone then retypes both into a spreadsheet before anyone can work the list.
Practice management software like Pabau closes that split. ERAs post automatically, and each claim settles to Paid or Denied with the CARC denial reason attached. The code and the claim end up in the same record.
The response runs from that record too. Corrected claims, voids and appeals go out from the claim you are already looking at. Every step lands in that claim’s activity history, so you can see what was sent and when. Claims reach more than 4,000 US payers through the Claim.MD integration.
So your biller works a denial list in one screen, instead of reconciling a payer PDF against a spreadsheet before the real work starts.
Work denials from the claim record
Pabau posts ERAs automatically and attaches the CARC denial reason to each claim. Your team can send a corrected claim, void or appeal without leaving the record. Every action is logged in the claim’s activity history.
Conclusion
Treat a denial code as an instruction. Almost all of them tell you exactly what to do next. The practices that read them quickly get paid on resubmission, while everyone else writes the balance off at month end.
The habit worth building is small: before anyone touches a denied claim, check the group code, then the reason code, then the remark code. Those three fields decide whether the next hour is spent on a corrected claim, an appeal, a statement, or nothing at all. Print the cheat sheet above and that decision takes seconds.
The harder problem is usually not the code itself. It is that the code and the claim live apart, so nobody spots the pattern until a quarter’s worth of denials has stacked up. Book a demo to see how Pabau keeps the denial reason on the claim record and the whole response in one place.
Continue your research
Need the system that sends the claim in the first place? What is a medical claims clearinghouse? explains how claims are scrubbed and routed before a payer ever sees them.
Want to stop denials rather than decode them? Healthcare revenue cycle management guide sets denial work in the wider cash cycle it belongs to.
Fixing the form the denial came from? CMS-1500 form: complete guide and free template walks through every box that triggers a CO-16.
Chasing a CO-197 authorization denial? Medical prior authorization form gives you a template for getting approval on file first.
Billing patients who claim reimbursement themselves? What is a superbill? covers the document out-of-network patients submit to their own insurer.
Frequently asked questions
What are the top 10 denials in medical billing?
Medicare contractors publish their own rankings, and the same codes keep recurring. Novitas Solutions listed 18, 22, 26, 29, 50, 96, 97, 109, 170 and B15 among its top claim denials for April to June 2026. Duplicates, coordination of benefits, timely filing, medical necessity and bundling dominate every list.
What does CO 252 denial code mean?
CARC 252 means “An attachment/other documentation is required to adjudicate this claim/service.” The payer has paused on the claim rather than refused it. Send the records it asked for with a corrected claim rather than an appeal, and check the remark code, which names the document it wants.
What is the 4 denial code?
CARC 4 is defined as “The procedure code is inconsistent with the modifier used.” A required modifier is missing or invalid for that CPT code. Correct the modifier and resubmit. Medicare returns these as unprocessable, so they need a new claim rather than an appeal.
What are common denial codes in billing?
The ones you will meet most are CO-16 for missing information, OA-18 for duplicates and CO-22 for coordination of benefits. CO-29 covers timely filing, CO-50 medical necessity and CO-97 bundling. PR-1, PR-2 and PR-3 cover deductible, coinsurance and copay, and belong on a patient statement.
What is the difference between CARC and RARC codes?
A CARC gives the reason for an adjustment and carries the dollar amount. A RARC adds explanation and never moves money by itself. CMS requires at least one remark code alongside generic CARCs such as 16, because those codes cannot say what went wrong on their own.
