CO-97 Denial Code: Meaning, NCCI Edits, and How to Fix It

CO-97 means the payer treated one service as part of another service’s payment. According to the X12 code set, the reason code 97 implies that the payment for another kind of service, which was already processed, includes this service as well. The CO code is connected with the group code, signifying that the provider has a contractual obligation to make the necessary changes.

These guidelines highlight how to read a CO-97 line and how the NCCI edits form it, as well as when and by whom a modifier may be applied, and how to correct or appeal the denial. Come to the main ideas first before proceeding with the steps listed.

What Does CO-97 Mean?

CO-97 is a claim adjustment on the remittance advice. It mentions that the payer’s job was to pay one line, but folded the other line. There’s no mention of the other services in the code. You have to find it.

How to Read a CO-97 Line

Part	What it tells you
Group code CO	Contractual obligation. The provider is responsible for the adjustment.
Reason code 97	The benefit is included in the payment or allowance for another service already adjudicated.
Remark code, such as M144	Adds detail. CMS lists M144 with CO-97 when an E/M service falls inside a global surgery period.
835 policy ID segment (loop 2110 REF)	Points to the payer policy used, if the payer sent it.

X12 requires payers to look at the policy identification segment if it exists. Make sure to check it first, as it may identify the edit or policy under which the coding is bundled. 

CO-97 vs Other Common Denial Codes

Several codes sound alike. The X12 descriptions show where each one points.

CO-97 Compared With Similar Denial Codes

Code	X12 description	What it points to
97	Benefit included in the payment or allowance for another service already adjudicated	A bundled or included service
234	This procedure is not paid separately	A service that has no separate payment. A remark code is required
236	Procedure or procedure and modifier combination not compatible with another procedure on the same day according to the National Correct Coding Initiative	An NCCI pair that cannot be paid together
4	The procedure code is inconsistent with the modifier used	A modifier that does not fit the code
18	Exact duplicate claim or service	A repeat submission

If the edit appears as 97, inquire as to which payment service was included. But if a readout of 236 appears, the NCCI pair has been disclosed already.

How NCCI Edits Cause CO-97

The National Correct Coding Initiative (NCCI) refers to a set of edits from the CMS that prevent payments of overlapping services. Medicare utilizes them for claims processing. Most of the private payers use the same method to handle the claims.

Column 1 and Column 2 Codes

Procedure-to-procedure (PTP) edit consists of a Column 1 code and a Column 2 code. According to the CMS NCCI policy manual, if both are reported, the Column 1 code will get payment while the Column 2 code will not. The rule is applicable only for the same provider, patient, and date of service.

Modifier Indicators

Each pair carries a modifier indicator. It tells you whether a modifier can open payment for the Column 2 code.

NCCI Modifier Indicators

Indicator	What it means	What you can do
0	PTP-associated modifiers cannot be used to bypass the edit	Accept the denial. The Column 2 code is not payable with the Column 1 code
1	A modifier may be used to bypass the edit under appropriate circumstances	Add a modifier only if the record supports a distinct service
9	Use of a modifier is not specified	The pair has a deletion date equal to its effective date, so check the current edit

Other Edits That Look Alike

A medically unlikely edit (MUE) limits the quantities of one code for one date of service. CMS calls MUEs coding edits and not medical necessity edits. They have no modifier column. CMS posts PTP and MUE tables each quarter, so check the file for your date of service.

Common Causes of a CO-97 Denial

Coronis and Etactics list the most frequent causes. The list below fits those sources and the CMS manual.

When a Modifier Is Allowed

A modifier makes a claim regarding the record, and this claim must be substantiated. According to CMS NCCI policy manual’s guidance, modifiers shouldn’t be added to the code without sufficient circumstances to support it.

Modifier 59 and the X Modifiers

According to NCCI, the purpose of modifier 59 is to validate that two procedures occurred in different anatomical locations or in different patient encounters. According to the instruction by CMS, more precise X modifiers should be applied wherever possible. Use 59 only when none does.

Modifiers That Can Open a Payable Pair

Modifier	CMS meaning	Typical support in the note
XE	Separate encounter on the same date of service	Two visits, each documented with its own time
XS	Separate organ or structure	A different organ, region, or lesion named in the note
XP	Separate practitioner	A different practitioner performed the service
XU	Unusual non-overlapping service	A service that does not overlap the usual components of the main procedure
59	Distinct service when no X modifier fits	A different site, session, or lesion that the record shows

CMS says different diagnoses alone are not enough to support these modifiers. It also says modifier 59 should not be added to an E/M service.

E/M Services and Modifiers 24 and 25

When billing for an E/M visit combined with a minor operation, you should employ modifier 25 to represent the critical nature of the visit. Additionally, E/M visits can occur during the global surgical period as long as you utilize either modifier 24 or 25 correctly. Global surgery periods can last for zero days (000), for 10 days (010), or for 90 days (090). It should be evident that the visit has nothing to do with the particular procedure, or that its nature goes beyond the standard follow-up.

Who Is Liable? Patient Liability for CO-97

The group code decides the starting point. CO means the provider owes the adjustment. PR means the patient owes it.

Who Owes the Balance on a CO-97 Line

Situation	Who owes the balance
Medicare claim with a CO-97 adjustment	The provider. The patient may be billed only for amounts reported with PR
Commercial plan with a CO-97 adjustment	The provider writes off the amount in most cases. Check the payer contract
A separate PR amount on the same remittance	The patient, as the plan states, such as a deductible or coinsurance

DocStation warns against moving a CO-97 amount to the patient based on the code alone. Read the whole remittance line first. Do not create a second encounter or a new specimen to get a bundled service paid.

How to Fix a CO-97 Denial

Work through these steps in order.

1. Read the full remittance line. Take a note of the group code, the reason code, the remark code, and the total paid amount.
2. Find the paired service. Look into other entries for the same patient on the same date, including previous claims.
3. Check the edit. Check the pairing code in the most recent NCCI table. Be sure to verify the payer policy as well.
4. Compare the note to the record. Check for separate sites, visits, encounters, and practitioners.
5. Correct the claim when the error is yours. If it was established that a modifier was missing from your claim and it was indeed referenced in the record, submit a correction with a more specific modifier. If the codes on your claim contain errors, rectify them.
6. Accept the denial when the edit blocks it. If your claim contained the correct modifier but the payer still bundled the claim, submit an appeal alongside the accompanying note.
7.  If your claim contained the correct modifier but the payer still bundled the claim, submit an appeal alongside the accompanying note.

Corrected Claim or Appeal

Send a corrected claim when the claim itself was wrong. File an appeal if your claim was correct, but the payer messed up the edit. Note that deadlines vary depending on the payer, so be vigilant when reading your denial notice.

What an Appeal Should Include

• The claim number, the date of service, and the denied line.
• The edit or policy the payer applied.
• The modifier used and the reason it fits.
• The operative or progress note, attached and marked at the key lines.

Regarding Medicare, a redetermination is known as the 1st appeal. The period within which to file the appeal is 120 days from the time one receives the notice of the original determination. To appeal, one should fill in form CMS-20027 or write a letter including the beneficiary’s name, the Medicare number, the service in question, and the date of service, as well as a rationale for disagreement.

How to Prevent CO-97 Denials

Most CO-97 denials can be caught before the claim goes out.

• Check code pairs before you bill. Run each claim against the current NCCI tables and your payer policies.
• Use a claim scrubber. It flags pairs that need a modifier or pairs that cannot be paid together.
• Write notes that name the site and the session. The note should show why a service was distinct.
• Pick the most specific modifier. Use XE, XS, X, P, or XU before 59.
• Track the global period. Mark the surgery date and the period so follow-up visits are coded correctly.
• Review denials by code pair. A repeat CO-97 on the same pair shows where the edit is catching you.

Our medical coding services team reviews code pairs and modifiers before submission.

How A2Z Medical Billing Services Helps With Bundling Denials

Our team reads each remittance, finds the paired service behind a CO-97, and checks it against the NCCI table and the chart. We correct claims when the record supports a modifier. We also build appeals when the payer applied an edit wrongly. Our denial management services cover the work from the first review to the final appeal.

Frequently Asked Questions

What does CO-97 mean on a remittance?

CO-97 means the payer included the service in the payment for another service already adjudicated. The CO is the group code for contractual obligation, and 97 is the reason code. Look at the other lines for the same date of service to find the paired service.

Can I bill the patient for a CO-97 denial?

Generally no. A CO group code means the provider owes the adjustment. For Medicare, the patient may be billed only for amounts reported with PR. Read the full remittance line and your payer contract before you send a statement.

What is the difference between CO-97 and CO-236?

CO-97 says the service is included in another service. CO-236 says the procedure or modifier combination is not compatible with another procedure on the same day according to NCCI. A CO-236 line points straight to an NCCI pair. A CO-97 line needs you to find the pair.

Will modifier 59 fix a CO-97 denial?

Use the modifiers XE, XS, XP, or XU only if the code pair permits a modifier and the record indicates a distinct site, session, or encounter. The CMS considers the use of modifier 59 as appropriate only if there are no suitable alternatives. A modifier added just to get paid can lead to an audit finding.

What does a modifier indicator of 0 mean?

The presence of an indicator value of 0 implies that no modifier can override the edit. If both codes are filed together, only the code of Column 1 gets reimbursed while the code of Column 2 gets rejected. You cannot rebill that pair with a modifier.

Why did my E/M visit deny with CO-97?

The visit may fall inside the global period of a recent procedure. CMS states that an E/M with a global period is subject to denial with CO, CARC 97, and RARC M-144 unless it has modifier 24 or 25 as needed. The documentation must back the modifier.

How long do I have to appeal a CO-97 denial?

In Medicare, the request for redetermination has to be made within 120 days from the date of receipt of the first determination letter. However, other insurance companies tend to have their own timeline as stipulated in their contract or denial letter.

Final Thoughts

CO-97 is a coding problem that has to do with billing. You need to find the appropriate service and check the NCCI code edits. If the service gets accepted as separate, the claim must be resubmitted with an appropriate modifier. If it is denied, you should modify the code in your system to fix the issue. Checking the pairs before each claim will stop all CO-97 denials from happening in your business. Feel free to contact our team for help with appeals.