CO-167: Diagnosis Not Covered

What Does CO-167 Mean?

With CO (Contractual Obligation), the CARC 167 adjustment is the provider's responsibility. The payer denied or reduced payment because of the patient's insurance plan specifically excludes coverage for the submitted diagnosis, such as cosmetic conditions, certain mental health diagnoses, or experimental conditions. The patient is not liable for this amount. If the denial is in error, the provider can correct and resubmit the claim or file an appeal with supporting documentation.

CARC 167 indicates diagnosis not covered. The payer determined that the service or a portion of it does not meet coverage criteria under the patient's current plan benefits or the applicable coverage rules.

Common scenarios that trigger this adjustment include: the patient's insurance plan specifically excludes coverage for the submitted diagnosis, such as cosmetic conditions, certain mental health diagnoses, or experimental conditions; While the diagnosis itself may be covered, the payer does not consider it a covered indication for the specific procedure or service that was billed; The diagnosis code submitted does not accurately represent the patient's condition, and the code used happens to be excluded from coverage. The group code paired with CARC 167 determines who bears the financial responsibility — CO places it on the provider as a contractual obligation, PR shifts it to the patient, OA indicates a coordination of benefits or other payer adjustment.

Common Causes

How to Resolve

1. Review the remittance details Examine the CO-167 adjustment and any accompanying RARC codes to identify the specific reason for the denial.
2. Identify the root cause Determine which issue applies: diagnosis is excluded from coverage under the patient's plan, diagnosis not covered for the specific procedure billed, incorrect or non-specific diagnosis code, among others.
3. Correct the claim Address the identified issue — update the claim data in your billing system to resolve the diagnosis not covered 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.
5. Appeal if the original claim was correct Appeal with clinical documentation supporting the medical necessity of the service for the submitted diagnosis. Include evidence that the diagnosis should be covered, such as clinical guidelines, peer-reviewed literature, or plan provisions that were overlooked.

Common RARC Pairings

The RARC code tells you exactly what triggered the CO-167:

How to Prevent CO-167

• Verify diagnosis coverage with the patient's payer before providing services for conditions that may be excluded
• Code diagnoses accurately and to the highest level of specificity to avoid triggering coverage exclusions
• Maintain awareness of common diagnosis exclusions for each payer
• Include qualifying diagnoses for screening and preventive services when required by the payer
• Use claim scrubbing tools to flag diagnosis codes that are commonly excluded from coverage

Also Filed As

The same CARC 167 may appear with different Group Codes:

Related Denial Codes