What is adjustment reason code 96?

Adjustment code 96 means non-covered charge(s) under the patient's insurance plan.

Insurance companies use this Claim Adjustment Reason Code (CARC) when a billed service or supply is not part of the member's benefit package or is excluded by the policy. It always appears with a group code that assigns financial responsibility and is usually paired with a Remittance Advice Remark Code (RARC) for specific details.

Group Codes for Code 96

• PR-96 (Patient Responsibility): The cost shifts to the patient because the service is not covered by their plan. Providers can bill the patient if proper notice (like a Medicare ABN) was given beforehand.
• CO-96 (Contractual Obligation): The provider must write off the charge and cannot bill the patient because of a contractual agreement or failure to secure proper upfront authorization/waivers.
• OA-96 (Other Adjustment): Used for general adjustments, often involving coordination of benefits or secondary payers.

How to Resolve It

1. Check the Remark Code: Look at the accompanying RARC (such as code N130 or N56) to find the exact operational reason for the denial.
2. Verify Patient Benefits: Check if the service was a true policy exclusion or if it required a specific modifier (like the GY modifier for Medicare statutorily excluded services).
3. Correct and Resubmit or Appeal: If it was a coding mistake, fix the claim and resubmit. If documentation was missing, submit a redetermination request with the proper medical records.

The meaning of "96 code" depends heavily on the context, most commonly referring to a medical billing denial or a police radio code.

1. Medical Billing (CO-96 / PR-96)

In healthcare administration, CO-96 or PR-96 is a Claim Adjustment Reason Code (CARC) meaning non-covered charge.

• Meaning: The insurance company refuses to pay because the billed service or procedure is not included in the patient’s current benefit plan.
• Prefix difference:
  • CO-96 stands for Contractual Obligation, meaning the provider generally must write off the charge and cannot bill the patient unless specific advance notices (like an ABN) were signed.
  • PR-96 designates Patient Responsibility, meaning the patient may be billed directly for the non-covered service.

2. Police and Emergency Radio (10-96)

In law enforcement and emergency services, 10-96 is a ten-code whose exact definition varies by region and agency:

• Mental Subject / Detained Person: Many police departments use 10-96 to indicate a person with mental health issues or someone who needs to be detained/evaluated.
• Medical Emergency: Some emergency medical services (EMS) or police agencies use 10-96 to signal a serious injury or a subject requiring immediate medical attention.

To resolve a CO 96 "non-covered charge" denial, review your remittance advice, verify the patient's actual policy benefits, and correct any coding errors or file an appeal as detailed in the AnnexMed CO 96 Guide.

Step 1: Review the Remittance Advice (RA)

• Check the Group Code (CO means contractual obligation, meaning you cannot easily bill the patient).
• Look at the Remittance Advice Remark Codes (RARCs) paired with code 96 to find the exact reason for non-coverage.
• Identify if it is a coding mismatch, an exhausted benefit limit, or a true policy exclusion.

Step 2: Verify Coverage and History

• Check if the specific CPT (Current Procedural Terminology) code was paid by this payer for this provider before.
• Confirm whether a prior authorization or referral was required but missing from the initial claim.
• Call the insurance provider to confirm if the service is excluded or if they need extra documentation.

Step 3: Take Corrective Action

• Resubmit the claim: If you find a missing modifier, wrong place of service, or incorrect code, fix it and send a corrected claim right away.
• Request reprocessing: If the payer made a mistake on a service that is clearly covered under the plan, ask them to reprocess the claim and note the call reference number.
• File an appeal or reconsideration: Submit clinical notes or proof of medical necessity if the service requires clinical review.
• Write off the balance: If the service is truly not covered and no prior authorization or waiver (like an ABN) was signed by the patient, you must write off the charge per your contract.

A Blue Cross Blue Shield (BCBS) denial code 96 means non-covered charge(s), indicating that the service or item billed is not included under the patient’s insurance benefit plan.

What Code 96 Means

Code 96 is a Claim Adjustment Reason Code (CARC). It always comes with a Remittance Advice Remark Code (RARC) to explain the exact reason for the non-coverage. You will usually see one of two prefixes:

• PR-96 (Patient Responsibility): The service is not covered by the plan, and the cost may legally be billed to the patient (if proper upfront notice, like an advance waiver, was given).
• CO-96 (Contractual Obligation): The service is not covered, but the provider is contractually obligated to write off the charge and cannot bill the patient (unless a signed waiver or Advance Beneficiary Notice was obtained beforehand).

Common Causes

• Policy Exclusions: The specific treatment or procedure is explicitly excluded from the patient's insurance policy.
• Coding Errors: Incorrect CPT/HCPCS codes or missing modifiers were used, making the procedure look non-covered.
• Medical Necessity Mismatch: The diagnosis code (ICD-10) does not match the procedure code according to BCBS coverage rules.
• Missing Prior Authorization: The service required prior approval from BCBS before it was performed.

How to Resolve It

1. Check the Remark Codes: Look at the accompanying RARC or Explanation of Benefits (EOB) to find the precise sub-reason for the denial.
2. Review the Coding: Verify that the procedure and diagnosis codes are accurate and include any required modifiers.
3. Verify Prior Authorization: Confirm whether an authorization was needed and if it was submitted.
4. Resubmit or Appeal: If it was a coding error or missing documentation, correct the claim and resubmit. If the service genuinely lacks coverage or medical necessity guidelines weren't met, you can file a formal clinical appeal with supporting medical records. For further guidance on fighting incorrect denials, refer to detailed breakdown resources like Why Insurers Use PR 96 Denial Code.

Adjustment codes, known formally as Claim Adjustment Reason Codes (CARCs), are standardized alphanumeric labels used in medical billing to explain why an insurance payment differs from the amount billed.

Insurance companies and health plans place these codes on an Explanation of Benefits (EOB) or Electronic Remittance Advice (ERA) to show why a claim was denied, reduced, or altered.

How Adjustment Codes Work

• What happened (CARCs): Three-character codes that state the financial reason for a payment change, such as a service not being covered or a duplicate submission.
• Who pays (Group Codes): Attached prefixes that show financial liability. Common groups include CO (Contractual Obligation written off by the provider) and PR (Patient Responsibility for deductibles or copays).
• Why it happened (RARCs): Remittance Advice Remark Codes often accompany CARCs to provide extra non-financial details or next steps.

Common Examples

• CO-45: The charge exceeds the allowed or contracted fee schedule maximum.
• PR-1: The amount applies to the patient's deductible.
• CARC 96: Non-covered charges based on the benefit plan.