PI-278: Performance Program Proficiency Requirements Not Met
The payer reduced payment based on their performance assessment. Request the detailed scorecard, verify the data, and dispute if incorrect.
What Does PI-278 Mean?
PI-278 is a payer-initiated reduction based on the payer's assessment of your performance against program requirements. The payer determined you did not achieve the required proficiency level and applied a payment adjustment accordingly.
CARC 278 indicates a payment adjustment because the provider failed to meet the proficiency requirements of a quality or performance program. These programs — including CMS's Merit-based Incentive Payment System (MIPS), commercial value-based payment arrangements, and other pay-for-performance contracts — set specific benchmarks that providers must achieve to receive full payment.
The adjustment can stem from genuinely failing to meet quality metrics, but it can also result from incomplete or incorrect data reporting. If the provider met the benchmarks but the data was not properly submitted or was submitted late, the payer may incorrectly apply the adjustment. The 835 Healthcare Policy Identification Segment (loop 2110 REF) typically identifies which specific program triggered the adjustment. Under CO, the adjustment is treated as a contractual obligation — the provider agreed to the performance terms and did not meet them. Under PI, the payer initiated the reduction based on their assessment of the provider's performance metrics.
How to Resolve
- Review the remittance Check the 835 detail for the specific performance program and adjustment amount.
- Request the performance scorecard Contact the payer to obtain the full performance report showing which metrics triggered the reduction.
- Dispute if data is wrong If the payer used incorrect performance data, submit corrected metrics with supporting documentation.
- Implement quality improvements Address the performance gaps identified to meet proficiency thresholds in future measurement periods.
Performance Program Proficiency Requirements Not Met under PI is a payer-initiated reduction where the payer has determined the patient is not financially responsible. These reflect payer-side decisions outside the normal adjudication path, so appeals don't apply. Review the accompanying context and accept the adjustment.
How to Prevent PI-278
- Proactively review payer performance scorecards to identify areas needing improvement before adjustments are applied
- Engage with performance programs early to understand measurement criteria and thresholds
- Implement continuous quality improvement processes aligned with each payer's metrics
Also Filed As
The same CARC 278 may appear with different Group Codes:
Sources
- https://www.mdclarity.com/denial-code/278
- https://resdac.org/sites/datadocumentation.resdac.org/files/Adjustment%20Reason%20Code%20Code%20Table%20(TAF%20Claims).txt
- https://x12.org/codes/claim-adjustment-reason-codes
- Codes maintained by X12. Visit x12.org for official definitions.