RARC M77: Missing or Invalid Place of Service

What Does RARC M77 Mean?

M77 indicates that the payer could not process the claim because the place of service (POS) code is either absent or contains an unrecognized value. The POS code is a two-digit field on professional claims (CMS-1500, Box 24B) that tells the payer where the service was delivered — an office, hospital outpatient department, ambulatory surgical center, patient's home, and so on. This code directly affects how the claim is priced and whether the service is covered, since many payers apply different fee schedules and coverage rules based on the care setting.

A blank POS field is the most straightforward trigger, but M77 can also appear when a valid-looking code is entered that does not match any recognized POS value in the payer's system. This sometimes happens when new POS codes are introduced (such as POS 10 for telehealth in the patient's home) and the payer has not yet activated the code, or when a billing system defaults to an obsolete or placeholder POS value. In rare cases, the POS code may be technically valid but not accepted by a specific payer for the type of service being billed.

M77 commonly appears alongside CARC 16 (missing information) or CARC 182 (procedure code requires a different POS). When paired with CARC 182, the issue may be less about a missing code and more about using the wrong setting for the billed procedure.

What to Do

Verify the correct POS code for the location where services were actually rendered. Cross-reference the code against the current CMS POS code list and confirm the payer accepts that code for the type of service billed. If the POS field was left blank, populate it with the appropriate code. If a code was entered but rejected, check whether the payer has published any restrictions or effective dates for that POS value. Correct the claim and resubmit.

For practices that operate across multiple settings — such as a physician group that sees patients in the office, hospital, and via telehealth — setting up POS defaults at the scheduling or encounter level can reduce errors. Review your billing templates periodically to make sure POS defaults have not drifted, especially after adding new service locations or telehealth modalities. When CMS introduces new POS codes, verify with each payer that they accept the code before relying on it for billing.

Common Scenarios

• A telehealth visit is billed with POS 02 (telehealth — other than patient's home) when the payer requires POS 10 for telehealth visits where the patient was at home, resulting in an M77 rejection.
• A multi-location practice adds a new outpatient clinic but the billing system does not have the POS code configured for the new site, so claims go out with a blank POS field.
• A billing staff member accidentally enters POS 99, which is not a recognized place of service code, instead of the intended POS 11 (office) due to a data entry error.

Commonly Paired With

RARC M77 commonly appears alongside these CARC denial codes: