PR-167: Diagnosis Not Covered

What Does PR-167 Mean?

PR-167 shifts the financial responsibility to the patient because their plan does not cover the submitted diagnosis. This group code is appropriate when the patient was informed in advance (via ABN for Medicare or similar notification) that the diagnosis might not be covered and elected to proceed. You are permitted to bill the patient for the full PR-167 amount, provided you followed proper notification procedures.

When CARC 167 appears on a remittance, the payer has denied the claim because the diagnosis or diagnoses listed on the claim are not covered by the patient's insurance plan. The payer is not saying the service was coded incorrectly or that the provider is ineligible — it is specifically flagging the diagnosis itself as outside the plan's covered conditions.

However, a significant portion of CARC 167 denials are actually coding errors rather than genuine coverage exclusions. Industry data from Experian Health indicates that 42% of all claim denials are caused by coding inaccuracies. A missing 7th character on an ICD-10 code, an incorrect code that maps to a non-covered condition, or an outdated code set can all trigger CARC 167 when the underlying diagnosis is actually covered. Before accepting this denial at face value, always verify the coding accuracy against the clinical documentation.

When the denial is legitimate, it typically involves plan-specific exclusions for cosmetic conditions, experimental treatments, certain mental health conditions, fertility services, or pre-existing conditions under older plan types. The financial impact depends entirely on the group code. CO-167 is a contractual write-off that the provider absorbs. PR-167 shifts the balance to the patient, but only if proper advance notification (ABN for Medicare, or similar payer-specific waiver) was obtained before the service. The 835 Healthcare Policy Identification Segment (Loop 2110 REF) often points to the specific NCD, LCD, or payer policy behind the denial — checking this field can save significant research time.

Common Causes

How to Resolve

Verify the ICD-10 diagnosis code is accurate and specific, check plan coverage, and either correct and resubmit or appeal with clinical documentation.

1. Verify proper advance notification Confirm you have a signed ABN (Medicare) or financial responsibility waiver (commercial) on file before billing the patient. Without it, you may not be able to collect.
2. Transfer balance to patient A/R Move the denied amount to the patient responsibility ledger and post it with a PR-167 reason for tracking.
3. Send patient statement Issue a clear statement explaining that the diagnosis is not covered under their plan, the specific amount owed, and available payment options.
4. Assist with patient appeal if disputed If the patient believes the diagnosis should be covered, help them file an appeal with the payer by providing clinical documentation and medical necessity arguments.

Common RARC Pairings

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

How to Prevent PR-167

• Obtain an ABN or financial responsibility waiver before providing services for potentially non-covered diagnoses
• Educate patients about their plan's diagnosis coverage limitations and exclusions during intake
• Provide cost estimates when a non-covered diagnosis is identified so patients can make informed decisions
• Verify diagnosis coverage with the payer before proceeding with services

General Prevention

• Obtain an ABN or financial responsibility waiver before providing services when the diagnosis may not be covered
• Educate patients about their plan's diagnosis coverage limitations during intake
• Check diagnosis coverage with the payer before proceeding with services for potentially excluded conditions
• Provide cost estimates to patients when a non-covered diagnosis is identified so they can make informed decisions

Also Filed As

The same CARC 167 may appear with different Group Codes:

Related Denial Codes