CARC 237 Active

PR-237: Legislated/Regulatory Penalty

TL;DR

Patient responsibility for a regulatory penalty is unusual. Verify the assignment.

Action
Review & Decide
Who Pays
Patient
Appeal
No
Patient Impact
Direct Financial
Disclaimer
This content is for informational purposes only and does not constitute professional billing advice. Always verify information against your payer contracts and current coding guidelines. Consult a certified billing specialist for specific claim issues.

What Does PR-237 Mean?

With PR, the patient was assigned a regulatory penalty. This is unusual — regulatory penalties typically apply to the provider, not the patient.

CARC 237 indicates that the payer reduced payment on the claim as a penalty mandated by legislation or regulation. Common examples include Medicare payment reductions under the Hospital Readmissions Reduction Program (HRRP), Medicare's Value-Based Purchasing (VBP) penalties, sequestration reductions, or state-mandated penalty programs.

Unlike CARC 223 (legislated adjustment), which is a general regulatory adjustment, CARC 237 specifically indicates a penalty — a punitive reduction based on the provider's performance, compliance, or other regulatory criteria. These penalties are typically not appealable through normal claim appeal channels.

How to Resolve

  1. Verify the assignment Contact the payer to confirm PR is correct for a regulatory penalty.
  2. Collect if confirmed If confirmed, communicate the charges.
Do Not Appeal This Code

Legislated/Regulatory Penalty grouped under PR places the financial responsibility on the patient. The specific reason depends on the context of this adjustment — review any accompanying RARC codes for detail. Because this represents a placement of responsibility rather than a coverage denial, an appeal isn't the right action; verify the placement is correct before billing the patient.

How to Prevent PR-237

Also Filed As

The same CARC 237 may appear with different Group Codes:

CO-237 OA-237

Related Denial Codes

PR-13 — Date of Death Precedes Date of Service PR-14 — Date of Birth Follows Date of Service PR-19 — Workers' Compensation Claim PR-20 — Liability Carrier Responsible PR-21 — No-Fault Carrier Responsible

Sources

  1. https://x12.org/codes/claim-adjustment-reason-codes
  2. 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
  3. https://www.aapc.com/resources/claim-adjustment-reason-codes
  4. Codes maintained by X12. Visit x12.org for official definitions.