Managing finances in the healthcare industry is very difficult. The management becomes more difficult due to insurance payment delays and denials. Practices lose billions of dollars yearly because of claim denials. To give you an idea of just how big this problem is, let’s look at a recent example.
HealthCare.gov is one of the largest insurance exchange platforms in the United States. In just 2021, insurers denied 48.3 million claims out of 291.6 million total submitted. That’s over 16.5%, and you can guess how much loss this would have cost.
The CO 97 denial code causes a large chunk of these denials. Even though it is among the most commonly occurring denials, it is also one of the most misunderstood. So, what is denial code 97?
That’s what we are going to discuss in this blog. We will provide a detailed description of the CO 97 denial code and discuss its causes, prevention, and resolution tips. So, let’s start.
CO 97 Denial Code Description
An insurance company rejects a claim with a CO 97 denial code when it believes that a specific service or procedure is not eligible for separate reimbursement. This happens because the cost is already included or paid for in another adjudicated service.
Yes, the definition can be complex. Simply put, the payment for the service in question is bundled with another rendered procedure or service.
You can think of CO 97 as a type of unbundling. Although it is not entirely unbundling, the authorities might flag it as such if this happens frequently at your healthcare practice. If this happens, it could have serious legal consequences. So, it is essential to avoid it.
What Causes the CO 97 Denial Code?
To put it in one sentence, the denial code 97 happens because of the complexity of the billing process, which can sometimes confuse the biller and coders.
Let’s break down the causes and discuss them in detail.
Bundled Procedures
The first reason for CO 97 is bundled procedures. Some procedures are inherently linked and billed together.
For example, if a doctor must collect a specimen during surgery, the surgery and specimen collection will be considered a single service.
The Centers for Medicare & Medicaid Services (CMS) have given some rules to help medical coders select the correct code and make sense of this complexity. If your coders and billers are not trained and don’t know this, then it is easy to make this mistake.
Global Period Services
Understanding this can be tricky. We will explain it as simply as we can.
“Global Period” refers to a fixed time after a surgical procedure. During this time, the related follow-up care and procedures are considered part of the original service, which is surgery.
This means the insurance payer will not pay separately for services like routine check-ups, wound care, or other post-operative care during this global period. However, any service provided after the global period can be billed separately.
Now, you might be wondering how long this duration is. Well, the global period for minor procedures usually lasts 10 days, while it extends to 90 days for major surgeries.
Inclusion of Ancillary Services
Certain services, like specimen transport to a laboratory, are included in existing fee schedules and do not qualify for separate payment.
Lack of Proper Modifiers
This is where a lot of billers make mistakes. Incorrect use of modifiers can cause the CO 97 denial code. Modifiers 59 and 79 are most important in managing denial code 97.
Here’s what each modifier is used for:
- Modifier 59: If you want to bill for a service performed on the same day but unrelated to the original procedure, you can append modifier 59 to your claim.
- Modifier 79: Modifier 79 is similar to 59 but is slightly different. It is used for services performed during a global period that have no connection with the original surgery or procedure.
See? The difference between the two is minute, and coders can easily get confused. If the biller forgets to add the modifiers in the claim request or gets confused between the two, there is a high chance of rejection through the CO 97 denial code.
Incorrect Coding Practices
Mistakes in coding, such as using mutually exclusive codes or failing to review code bundling guidelines, can lead to denials.
How To Prevent Denial Code 97?
Although denials are inevitable, you can take the following preventive measures to reduce their occurrence.
Review Codes Thoroughly
The first thing you can do as a healthcare provider or a biller is to research and double-check all the codes related to your procedure before submitting your claim. Try to identify mutually exclusive or bundled codes to decide which code is most appropriate.
Provide Regular Training and Leverage Modifier Expertise
Knowledge of modifiers is absolutely essential to avoid CO 97 denials. Get your billing staff trained in modifier usage, especially to ensure they understand the correct usage of modifiers 59 and 79.
To do this, you can conduct regular training sessions. The best way to do it is to hold in-house sessions with an expert in medical coding. Training sessions alone aren’t enough. To get the best out of your employees, help them get certifications like:
- Certified Professional Coder (CPC)
- Certified Risk Adjustment Coder (CRC)
- Certified Outpatient Coder (COC)
- Certified Inpatient Coder (CIC)
- Certified General Surgery Coder (CGSC)
Invest in Modern Billing Software
If you are still trying to do all the work manually, it will be a nightmare. Try to implement some computer-based coding systems and software in your organization. Good software must have claim-scrubbing features that can automatically flag errors. Also, if possible, try to get software that can provide bundling suggestions. This will help your employees tackle and prevent CO 97 denial codes.
Conduct Billing Audits
Regular medical billing audits help identify recurring errors and areas for improvement, ensuring that your claims align with payer policies.
Outsource Denial Management Services
If managing the coding is becoming too cumbersome, it is better to outsource denial management services to expert vendors like NeuraBill. Doing this will save you not only a lot of work but also a lot of money in denial losses.
How To Resolve Denial Code CO 97?
Whenever you encounter a CO 97 denial code, you can take the following steps to resolve it.
Review The Denial Reason
The first step in solving any problem is to understand why it happened in the first place.
To understand why the claim was denied, start by reviewing the explanation of benefits (EOB) or the insurer’s electronic remittance advice (ERA).
Verify Modifier Usage
The next step is to ensure that the correct modifier is used. The modifier should mark the performed service as separate from other services. If you forgot to add a modifier earlier, add it to the claim and resubmit.
Appeal the Denial
If you believe the denial is an error, prepare an appeal and include supporting medical records. However, you must justify your case for it to succeed. Attach all the relevant documents/ proofs that explain the necessity of billing the service separately.
Communicate with the Claims Department
Contact the insurer’s claim department if you are confused about the reason for denial code 97. Ask them to clarify reasons for refusal, appropriate modifiers, and appeal timelines. Also, note the claim number and the call reference number. These notes will come in handy if you have to contact the insurer again.
Maintain Accurate Documentation
Accurate and detailed documentation of services provided is critical for defending claims during an appeal process. Thoroughly record all patient interactions and procedures.
Final Word
CO 97 denial code is common. However, it can be managed and prevented with little effort. If you understand its root causes, you can implement effective strategies to reduce the chance of getting CO 97 denials.
Denial management is very complex and requires expert supervision and experienced coders. If your hospital is short on staff or you struggle to manage many denials, it is better to let professionals handle it. You can outsource denial management services to our expert billing consultants at NeuraBill. We can help you optimize your revenue cycle!
