CO-45 vs CO-97: Understanding Denial Codes

CO-45 denial codes typically result in a write-off, as they are contractual adjustments that cannot be balance-billed to the patient. For instance, if a payer allows $100 for a particular service but the practice billed $150, the $50 difference would be written off as a CO-45 adjustment. On the other hand, CO-97 codes often require a review of the billing process to ensure that the correct modifiers are used to unbundled services. In our experience, a thorough analysis of the claim and the use of modifiers such as 25 or 59 can help prevent unnecessary denials and ensure accurate reimbursement.

In one specific case, we worked with a practice that was consistently receiving CO-97 denials for their intensive outpatient program (IOP) services. After reviewing their billing process, we discovered that they were not using the correct modifiers to distinguish between individual and group therapy sessions. By implementing the correct modifiers and providing additional documentation to support the services provided, we were able to reduce their CO-97 denials by 30% and increase their revenue by $10,000 per month.

Preventing CO-45 and CO-97 denials requires a thorough understanding of the payer's fee schedule and the correct use of modifiers. One key step is to verify the payer's allowed amount for each service before submitting the claim. This can be done by checking the payer's website or contacting their customer service department. Additionally, practices should ensure that their billing staff is trained on the correct use of modifiers and that they are using the most up-to-date codes and guidelines.

For example, if a practice is providing physical therapy services, they should ensure that they are using the correct CPT codes and modifiers to distinguish between different types of services. They should also verify that the payer allows for the specific services provided and that the charges are within the allowed amount. By taking these steps, practices can reduce their CO-45 and CO-97 denials and improve their overall revenue cycle management.

In our experience, implementing a solid billing and coding process can help prevent denials and reduce accounts receivable days. We have seen practices reduce their AR days from 60 to 30 by implementing a thorough verification process and ensuring that their billing staff is trained on the correct use of codes and modifiers.

Appealing CO-45 and CO-97 denials requires a thorough understanding of the denial reason and the supporting documentation. For CO-45 denials, practices should review the payer's fee schedule and ensure that the charges are accurate and within the allowed amount. For CO-97 denials, practices should review the billing process and ensure that the correct modifiers are used to unbundled services.

In one case, we worked with a practice that received a CO-97 denial for a service that they believed was separate and distinct from another service. We reviewed the claim and the supporting documentation and determined that the practice had not used the correct modifier to distinguish between the services. We submitted an appeal with the corrected modifier and additional documentation, and the payer reversed the denial and paid the claim in full.