OA-144: Incentive Adjustment for Preferred Product/Service

What Does OA-144 Mean?

OA-144 may appear when the incentive adjustment is classified as an administrative matter rather than a strict contractual obligation. The practical handling is the same — verify preferred product status and documentation accuracy.

CARC 144 is used when payers adjust claim payments based on incentive provisions that reward the use of preferred products or services. These incentive programs are common in pharmacy, DME, and clinical supply chains — payers negotiate preferred pricing with specific manufacturers or suppliers, and providers who use those preferred products receive higher reimbursement. When a non-preferred product is used, the payer reduces payment by the incentive differential, which is communicated through CARC 144.

This code is most commonly paired with Group Code CO, indicating the incentive adjustment is a contractual matter and the provider cannot bill the patient for the adjusted amount. The adjustment is not a denial — the claim is processed and paid, but at a lower rate because the preferred product incentive does not apply. In some cases, the provider may have used the preferred product but failed to document it correctly on the claim, causing the payer to apply the non-preferred rate by default.

From a financial perspective, CARC 144 adjustments can accumulate significantly over time, especially in high-volume practices that frequently use products covered by incentive programs. Understanding which products are preferred by each payer and ensuring correct documentation can materially affect reimbursement rates. When a non-preferred product is clinically necessary, providers should document the medical rationale and submit to the payer for exception consideration.

How to Resolve

Verify whether the preferred product was used, check the incentive program terms, and resubmit with correct documentation if the preferred product was used but not properly identified on the claim.

1. Verify product and documentation Check whether the preferred product was used and whether the claim documentation correctly identifies it.
2. Correct and resubmit or accept Resubmit with corrected identifiers if the preferred product was used, or accept the adjustment if a non-preferred product was selected.

How to Prevent OA-144

• Maintain current preferred product lists for each payer
• Ensure correct product codes and identifiers are included on all claims

Also Filed As

The same CARC 144 may appear with different Group Codes:

Related Denial Codes