CO-147: Provider Accepted Reduced Payment from Regulatory Authority

What Does CO-147 Mean?

With CO (Contractual Obligation), the CARC 147 adjustment for provider accepted reduced payment from regulatory authority 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 147 appears on a remittance when the payer applies an adjustment for provider accepted reduced payment from regulatory authority. 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 provider has accepted payment from a state or federal regulatory authority for the same service, and the payer is denying or reducing the claim to avoid duplicate payment; The provider received payment from workers' compensation, state fund, or another government regulatory program for this service, making the commercial claim ineligible for additional payment; The provider agreed to a reduced rate through a regulatory authority's settlement or negotiation process, and the payer applies this reduced amount. The group code paired with CARC 147 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 adjustment against contract terms Compare the CO-147 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 Appeal if no payment was received from a regulatory authority for this service. Include documentation proving no prior payment was received, such as payment records, EOBs from the cited regulatory program, or a letter confirming the service was not covered by the regulatory authority.
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.

Common RARC Pairings

The RARC code tells you exactly what triggered the CO-147:

How to Prevent CO-147

• Track all payments received from regulatory authorities and ensure claims are not submitted to other payers for services already paid
• Implement a tracking system for workers' compensation and government program payments to prevent duplicate billing
• Verify coordination of benefits before claim submission to identify services covered by regulatory programs
• Train billing staff on the rules for billing multiple payers when regulatory authority payments are involved
• Maintain clear records of regulatory settlements and negotiated rates to ensure accurate billing

Also Filed As

The same CARC 147 may appear with different Group Codes:

Related Denial Codes