Monday, August 13, 2012

Denial Group Codes - PR, CO, CR and OA explanation

Group codes identify the financially responsible party or the general category of payment adjustment. A group code must always be used in conjunction with a CARC.

Group codes are codes that will always be shown with a reason code to indicate when a provider may or may not bill a beneficiary for the non-paid balance of the services furnished.

Payment Adjustment Category Description

• PR (Patient Responsibility).

• CO (Contractual Obligation).

• OA (Other Adjustment).

• CR (Correction or Reversal to a prior decision).

Group Code PR

All denials or reductions from the billed amount with group code PR are the financial responsibility of the beneficiary or his supplemental insurer (if it covers that service).

Due to the frequency of their use, separate columns have been set aside for reporting of deductible and coinsurance, both of which are also the patient’s responsibility.

PR amounts, including deductible and coinsurance, are totaled in the Patient Responsibility field at the end of each claim.

Charges that have not been paid by Medicare and/or are not included in a PR group are:

• Late filing penalty (reason code B4),

• Excess charges on an assigned claim (reason code 42),

• Excess charges attributable to rebundled services (reason code B15),

• Charges denied as a result of the failure to submit necessary information by a provider who accepts assignment,

• Services that are not reasonable and necessary for care (reason code 50 or 57) for which there are no indemnification agreements are the liability of the provider.

Providers may be subject to penalties if they bill a patient for charges not identified with the PR group code.

Group Code OA

Group code OA is used when neither PR nor CO applies, such as with the reason code message that indicates the bill is being paid in full.

Group Code CR

Group code CR - Correction to or reversal of a prior decision is used when there is a change to the decision on a previously adjudicated claim, perhaps as the result of a subsequent reopening.

This group applies whenever there is a change to a previously adjudicated claim. Separate reason code entries must be used in the NSF for the CR group entry and any other groups that apply to the readjudicated claim. At least one reason code is always used with a group code in the NSF. We always enter the reason code(s) and that amount from the initial remittance advice for the service being corrected with the CR, and include any additional reason code that may apply to the subsequent adjustment. If the change does not involve a prior denial/reduction reason code reason code 93 is used

Reminder: Group code CR explains the reason for change and is always used in conjunction with PR, CO or OA to show revised information.


Group Code CO

Group code CO- Contractual obligations is always used to identify excess amounts for which the law prohibits Medicare payment and absolves the beneficiary of any financial responsibility, such as:

• Amounts for services not considered being reasonable and necessary.

• Participation agreement violations or Limiting charge violations.

• Assignment amount violations,

• Excess charges by a managed care plan provider,

• Late filing penalties,

• Gramm-Rudman reductions,

• Medical necessity denials/reductions.

The patient may not be billed for these amounts.

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