CARC 142 Active

CO-142: Monthly Medicaid Patient Liability Amount

TL;DR

Contractual adjustment — review against your contract terms. The patient is not liable for this amount.

Action
Review & Decide
Who Pays
Provider
Appeal
No
Patient Impact
None
Disclaimer
This content is for informational purposes only and does not constitute professional billing advice. Always verify information against your payer contracts and current coding guidelines. Consult a certified billing specialist for specific claim issues.

What Does CO-142 Mean?

With CO (Contractual Obligation), the CARC 142 adjustment for monthly medicaid patient liability amount is a contractual reduction. The provider absorbs this amount per the payer contract or regulatory payment methodology. The patient is not responsible for the adjusted amount. Review the remittance to confirm the adjustment is consistent with your contract terms.

CARC 142 appears on a remittance when the payer adjusts payment for the monthly medicaid patient liability amount. This is a standard plan-defined cost-sharing amount that the patient is obligated to pay per their insurance benefits. The code confirms the payer processed the claim correctly and applied the plan's benefit structure as designed.

Common scenarios that trigger this adjustment include: the Medicaid beneficiary has a monthly spend-down (patient liability) amount they must incur in medical expenses before Medicaid coverage begins. CARC 142 represents this patient liability portion.; The patient's income is above the Medicaid eligibility threshold, but they qualify under a medically needy or spend-down program. The liability amount equals the excess income that must be applied to medical costs.; For Medicaid long-term care beneficiaries, the patient's income (minus personal needs allowance) must be applied to the cost of care. CARC 142 reflects this monthly patient contribution.. The group code paired with CARC 142 determines who bears the financial responsibility — PR shifts it to the patient, OA indicates a coordination of benefits or other payer adjustment, CO places it on the provider as a contractual obligation.

How to Resolve

  1. Review the adjustment against contract terms Compare the CO-142 adjustment with your payer contract to confirm the reduction is consistent with agreed terms or regulatory methodology.
  2. Verify the adjustment amount Confirm the dollar amount of the adjustment is calculated correctly based on the contracted rate and the service provided.
  3. Appeal if the adjustment is incorrect If the adjustment does not align with contract terms, file an appeal with contract documentation and supporting evidence.
  4. Process the contractual adjustment If the adjustment is correct per contract terms, process it accordingly in your billing system. This amount cannot be transferred to the patient.
Do Not Appeal This Code

Monthly Medicaid Patient Liability Amount recorded under CO is a contractual obligation — the provider absorbs this amount per the payer agreement. Without an error in how the contract was applied, appeals don't apply. Review the accompanying RARC codes for context and accept the adjustment when the contract terms were applied correctly.

How to Prevent CO-142

Also Filed As

The same CARC 142 may appear with different Group Codes:

PR-142 OA-142

Related Denial Codes

CO-3 — Co-payment Amount CO-85 — Patient Interest Adjustment CO-100 — Payment Made to Patient/Insured CO-101 — Predetermination: Anticipated Payment CO-105 — Tax Withholding Amount

Sources

  1. https://www.cms.gov/medicare-medicaid-coordination/medicare-and-medicaid-coordination/medicare-medicaid-coordination-office
  2. https://www.aapc.com/resources/claim-adjustment-reason-code-carc
  3. https://www.mdclarity.com/denial-code/142
  4. Codes maintained by X12. Visit x12.org for official definitions.