Handout · Cheat sheet
RCM Denial Codes (CARC / RARC)
Adjustment groups, common reason codes & the recovery workflow
Objective: Read a remittance, classify the denial, and pick the correct recovery action.
Adjustment groups (who owes)
- CO — Contractual Obligation — Provider write-off per contract. CANNOT be billed to the patient.
- PR — Patient Responsibility — Deductible / coinsurance / copay. Bill the patient.
- OA — Other Adjustment — Used when neither CO nor PR applies.
- PI — Payer Initiated — Payer's reduction not covered by a contract clause.
Common CARC codes
| Code | Meaning | Typical action |
|---|---|---|
| CO-16 | Missing / incomplete information | Read the RARC, correct & resubmit |
| CO-18 | Duplicate claim or service | Do not resubmit — verify |
| CO-22 | Covered by another payer (COB) | Bill the primary payer first |
| CO-29 | Timely filing limit expired | Appeal with proof of timely filing |
| CO-45 | Charge exceeds fee schedule | Contractual write-off |
| CO-50 | Not deemed medically necessary | Review dx linkage; corrected claim / appeal |
| CO-97 | Bundled into another service | Check NCCI edits; appeal if separately payable |
| CO-109 | Not covered by this payer | Bill the correct payer |
| CO-197 | Pre-cert / authorization absent | Retro-auth if allowed, then appeal |
| PR-1 / PR-2 / PR-3 | Deductible / Coinsurance / Copay | Bill the patient |
RARC & workflow
- RARC (Remittance Advice Remark Codes, N- and M- prefixed) explain or supplement the CARC — always read them to learn WHAT is missing.
- Workflow: read the CARC → identify the group (CO vs PR) → PR? bill the patient · CO? correct or appeal — never balance-bill a CO write-off.
Practise this
Practised at HealthAtoms · healthatoms.com — synthetic, educational reference.