CO-211: National Drug Codes (NDC) Not Eligible for Rebate, Not Covered
The drug NDC is not rebate-eligible. Verify the NDC, check for alternatives, and resubmit or request a formulary exception.
What Does CO-211 Mean?
With CO (Contractual Obligation), the non-rebatable NDC denial is the provider's responsibility. Verify the NDC, check for covered alternatives, and resubmit with a correct or covered NDC. If no alternative exists, appeal with medical necessity documentation.
CARC 211 indicates that the drug identified by the NDC on the claim is not eligible for coverage because the manufacturer has not participated in the required drug rebate program. For Medicaid, this means the drug manufacturer has not signed a Medicaid Drug Rebate Agreement, making the drug ineligible for Medicaid coverage. For other federal programs, the drug may not be listed in the Federal Supply Schedule.
This denial can also occur when the wrong NDC was submitted (a data entry error), when a brand-name NDC was billed instead of a covered generic equivalent, or when the drug product has been removed from the rebate program. The resolution depends on whether the correct NDC was submitted and whether a covered alternative exists.
Common Causes
| Cause | Frequency |
|---|---|
| Drug NDC not on payer's covered drug list The National Drug Code submitted is not eligible for federal or state rebate programs and therefore is not covered under the payer's formulary | Most Common |
| NDC not eligible for Medicaid drug rebate program The manufacturer has not signed a Medicaid drug rebate agreement for this NDC, making it ineligible for coverage under Medicaid | Most Common |
| Incorrect NDC submitted on claim The wrong NDC was billed for the drug administered, and the submitted NDC is not eligible for rebate | Common |
| Drug not in the Federal Supply Schedule For VA or other federal programs, the drug NDC is not listed in the Federal Supply Schedule | Occasional |
| Generic equivalent available but brand NDC billed The brand-name NDC was billed when a covered generic equivalent NDC should have been used | Occasional |
How to Resolve
- Verify the NDC Confirm the correct NDC was submitted.
- Check for covered alternatives Look for rebate-eligible NDCs or generic equivalents.
- Resubmit or request exception Correct the NDC and resubmit, or request a formulary exception with medical necessity documentation.
Appeal if the drug was medically necessary and no covered alternative exists. Include clinical documentation supporting the medical necessity for the specific drug and NDC. Request a formulary exception from the payer if applicable.
Common RARC Pairings
The RARC code tells you exactly what triggered the CO-211:
| RARC | Description |
|---|---|
| N130 | Consult plan benefit documents/guidelines for coverage of this service. Review the payer's formulary and drug rebate program requirements for covered NDCs → |
How to Prevent CO-211
- Verify NDC rebate eligibility before dispensing or administering medications
- Maintain an up-to-date list of rebate-eligible NDCs from applicable payers and programs
- Implement automated NDC validation in your pharmacy or billing system
- Use covered generic alternatives when available to avoid rebate eligibility issues
- Train pharmacy and billing staff on NDC rebate program requirements
Also Filed As
The same CARC 211 may appear with different Group Codes:
Related Denial Codes
Sources
- https://x12.org/codes/claim-adjustment-reason-codes
- https://portal.ct.gov/-/media/ohs/health-it-advisory-council/apcd-advisory-group/data-submission-guide-workgroup/meeting-materials/6-30-22/carc-codes_final.pdf
- https://www.aapc.com/resources/claim-adjustment-reason-codes
- Codes maintained by X12. Visit x12.org for official definitions.