The core responsibility of healthcare providers involves clinical activities like encountering patients, diagnosing illnesses, preparing treatment plans, and rendering procedures. But, the financial aspects, such as charge entry, code selection, claim submission, payment posting, etc., are also critical for running the practice smoothly.
Inaccuracies and inconsistencies in the medical billing process may lead to claim denials, ultimately leading to delayed payments. This guide will present a detailed discussion on the CO 24 denial code to help you understand how to mitigate the risk of triggering it.
So, without further ado, let’s get started!
CO 24 Denial Code – Description
The denial code CO 24 is related to a contractual obligation. You may receive this denial because the patient’s coverage falls under a managed care plan or a capitation agreement. It means the healthcare provider may have already received a fixed payment for the performed procedure, and the payer is not liable to pay any additional reimbursements.
A capitation agreement is a contract between a provider (hospital or doctor’s office) and a managed care organization (MCO) or insurance payer. Under this contract, the insurance company or MCO pays the healthcare practitioner a fixed monthly fee for every patient they encounter, regardless of the number of services.
Besides, you should understand that you can receive this denial against a broad range of rendered care services, including outpatient, inpatient, laboratory tests, etc.
Simply put, it offers providers insights into the issues in the medical billing workflow. Thus, it is optimal to understand the CO 24 denial and avoid potential financial setbacks. Appropriate action and proactive mitigation can ensure seamless reimbursements.
Common Causes of CO 24 Denial Code
Below is a list of reasons that may trigger this denial:
Capitation Agreement
One of the main reasons leading to denial code 24 is the capitation agreement, i.e., you provided services that fall under this agreement, and the payer has already paid you a fixed rate against it.
Multiple Insurance Plans
The payer may also trigger this denial when the patient is enrolled in multiple insurance plans, such as Medicare and Medicaid.
Outdated Eligibility and COB
Failure to verify patient eligibility and coordination of benefits (COB) before providing services may also result in the CO 24 denial code.
Out-of-Network Provider
The insurance payer may also flag the claim with the denial code 24 when the physician is not enrolled in their network.
Coding Errors
Selecting wrong procedural codes that are not covered under a specific insurance plan may also lead to this denial.
Inaccurate Billing
Entering inaccurate patient information or missing out on the provider details can also trigger this denial code.
Missing or Incomplete Documentation
If you fail to provide adequate documentation against your rendered procedure and supporting charges, the payer may deny the claim with denial code CO 24.
How to Prevent Denial Code CO 24?
Now that you know what can trigger denial code CO 24, it will be easier to understand the mitigation strategies. These will help you streamline your medical billing workflow for a healthier revenue cycle.
Ensure Comprehensive Documentation
Insurance companies want providers to maintain and submit detailed documentation justifying the appropriateness and medical necessity of rendered services. It is one of the many preventative strategies you can implement to avoid triggering the denial code 24.
Acquire Prior Authorization
Some medical procedures require the payer’s authorization or approval in advance. Thus, we recommend you make it a part of your medical billing process to mitigate the risk of claim denials.
Verify Insurance Eligibility
Another best practice that can help you prevent denial code 24 is verifying insurance eligibility to ensure the patient is enrolled in a managed care plan or a capitation agreement. You can verify eligibility and COB by contacting the insurance company directly.
Regularly Review Contracts
You should also train your staff to stay current on any changes and updates in the managed care plan or capitation agreement that may affect your reimbursements.
Ensure Accurate Billing and Coding
One effective strategy to mitigate the risk of denial code 24 is training your team on coding guidelines and billing requirements, including accurate code selection, appropriate modifier use, and entering the correct patient information, date of service, and provider information.
How to Resolve Denial Code CO 24?
The preventative strategies we discussed above will help you reduce the frequency of denial code 24. However, if you do get this denial, here’s how you should address and reverse it:
- Regardless of the denial code, your first step should be to understand what the code means.
- In case it is the CO 24 denial code, your next step should involve verifying that the patient is part of a managed care plan or a capitation agreement.
- Once the patient’s enrollment is confirmed, review the denied claim for any coding or billing errors that may have led to the denial code CO 24.
- Next, you should ensure that the patient’s COB details are up-to-date, specifically in the case of multiple insurance plans. This step can provide insight into the order of payment.
- Once the specific issue has been identified, rework the claim. That is, correct any error in codes or billing information. Also, provide additional documentation and then resubmit the claim.
- Follow up on the claim status by staying in touch with the payer to ensure speedy resolution.
Bottom Line
Here’s a quick recap of what we discussed in the guide! We explained denial code CO 24, what a capitation agreement entails, and the common reasons that trigger this denial. We also shared some denial mitigation strategies, like comprehensive documentation, regular contract review, accurate coding and billing, eligibility verification, and prior authorization, to help you avoid CO 24 denial in the future.
Lastly, we discussed the steps to successfully resolve denial CO 24. However, effective denial management requires staying current on coding and billing guidelines, compliance standards, different payer requirements, and industry trends. If all this seems challenging, you can outsource denial management to professionals like MediBillMD.
