CO-135: Interim Bills Cannot Be Processed

What Does CO-135 Mean?

With CO (Contractual Obligation), the CARC 135 adjustment is the provider's responsibility. The payer denied or reduced payment because of the payer does not process interim or split bills and requires a single claim for the entire episode of care. The patient is not liable for this amount.

CARC 135 appears on a remittance when the payer applies an adjustment for interim bills cannot be processed. Review the group code and any accompanying RARC codes to understand the full context of this adjustment.

Common scenarios that trigger this adjustment include: the payer does not process interim or split bills and requires a single claim for the entire episode of care; The bill type submitted indicates an interim bill, but the payer's system does not support interim billing for this service type; An interim bill for a long-stay inpatient was submitted before the payer's required billing cycle date. The group code paired with CARC 135 determines who bears the financial responsibility — CO places it on the provider as a contractual obligation, OA indicates a coordination of benefits or other payer adjustment, PR shifts it to the patient.

Common Causes

How to Resolve

1. Review the remittance details Examine the CO-135 adjustment and any accompanying RARC codes to identify the specific reason for the denial.
2. Identify the root cause Determine which issue applies: payer does not accept interim billing, incorrect bill type for interim claim, long-stay patient interim bill submitted prematurely, among others.
3. Correct the claim Address the identified issue — update the claim data in your billing system to resolve the interim bills cannot be processed problem.
4. Resubmit the corrected claim Submit the corrected claim following the payer's resubmission guidelines. Include any supporting documentation that addresses the denial reason.

Common RARC Pairings

The RARC code tells you exactly what triggered the CO-135:

How to Prevent CO-135

• Maintain a reference of payer-specific interim billing policies and acceptance rules
• Verify the payer accepts interim billing before submitting split claims
• Train billing staff on correct bill type codes for interim vs. final claims
• Track long-stay patients and schedule interim billing according to each payer's cycle requirements
• Implement billing system rules that prevent interim claims to payers that do not accept them

Also Filed As

The same CARC 135 may appear with different Group Codes:

Related Denial Codes