OA 23 Denial Code: Description, Reasons & Solution

Is denial code 23 affecting your healthcare practice’s revenue cycle? Don’t fret! We understand your concerns. 

We have come up with this comprehensive guide to discuss the reasons that trigger this denial code and share some best practices to help you avoid it. In case your claims get tagged with denial code 23, our resolution techniques will help you manage them. 

So, without further ado, let’s get started!

OA 23 Denial Code Description

OA 23 denial code indicates the claim denial due to prior payer(s)’ adjudication influence, including adjustments or payments. 

It usually occurs when there are multiple payers, and the reimbursement paid by the primary insurance payer is less than the allowable amount of the secondary payer, even though its allowed amount is higher. Therefore, the outstanding amount triggers a OA 23 denial code. Insurance companies often use this code with Group Code OA.

Example:

A patient is covered by two insurance payers – Company A and B. The adjudication for companies A and B are as follows.

Therefore, the outstanding $10, which payer B is unwilling to reimburse, will be flagged as an OA 23 denial code. 

What Causes the OA 23 Denial Code?

The major reasons leading to denials related to prior payer(s) adjudication are discussed below:

Inaccurate Payment or Adjustment

You may trigger the OA 23 denial code if prior payer(s) made an error while claim processing, leading to inaccurate payment or adjustment. Some reasons include system glitches, misinterpretations, or miscalculations.

Incomplete Documentation

Another reason behind the denial code 23 is missing, or inadequate documentation. During claim submission, if you fail to submit the required supporting documents or the provided documents do not meet the insurance company’s requirement, it can lead to this denial.

Out-of-Scope Services

If provided care services are not covered by the insurance payer under the patient’s enrolled plan, you may face this denial code. It may happen because of medically unnecessary services, plan limitations, or policy exclusions.

Issues Related to COB

You may encounter a denial code 23 if the patient has several insurance coverages. In such a scenario, the coordination of benefits (COB) is integral. Any conflicts and disparities in the COB process may lead to adjustment or payment issues.

Coding Errors

Incorrecting coding, such as wrong diagnostic or procedural codes or missing modifiers, can also result in denial code 23. That is, if the codes used in your claim do not align with the provided services, it can lead to claim denials.

Missed Deadlines

Different insurance payers have varying filing deadlines for claims. Thus, if you fail to submit the claim within the allowed time limit, it will trigger the OA 23 denial code, leading to delayed or missed payments.

Duplicate Claim

Claim duplication is another cause resulting in code OA 23. Insurance firms have policies to prevent double payments. Thus, if they identify duplicate claims, it can result in claim denial.

Contractual Agreements

If there is a discrepancy or violation of agreed-upon terms between the insurance payer and healthcare provider, it can trigger denial code 23.

OA 23 Denial Code Management & Resolution

Do you want to know how to reduce the chances of triggering prior adjudication-related denials? This section covers the best practices to help you avoid denial code 23:

Eligibility & Benefits Verification

We recommend you perform the patient’s primary payer insurance and benefits verification before the encounter to determine prior adjudication and coverage details leading to denials.

Accurate & Complete Documentation

Ensuring complete and accurate documentation to support the rendered care services can also help you avoid denial code 23. Now, you may wonder, what documents should you provide with your claim? These may include prior authorization details, medical necessity of medical services, and other supporting details required for claim submission and reimbursement.

Timely Claim Submission

Always stay on top of filing deadlines to avoid getting the OA 23 denial code. If you find it difficult and often miss deadlines, start by optimizing your claim submission workflow.

Claim Follow-up

Yes. Monitoring the status of submitted claims and following up on outstanding payments is a great idea to identify issues related to prior payer(s) adjudication for timely resolutions of denials.

Appealing Denials

Another best practice for resolving denials is identifying if an appeal is warranted. If yes, we recommend you follow the primary payer’s outlined appeal process and provide supporting documentation for your claim.

Stay Updated with Payer Policies

Staying current on the impacts of changing insurance payer guidelines and policies on claim adjudication and regularly reviewing updates to ensure compliance can help you reduce your chances of triggering denial code 23.

Leverage Automation

You should streamline your revenue cycle management process through automation tools to enhance efficiency, minimize manual errors, and reduce prior payer(s) adjudication-related denials.

Steps to Resolve Denial Code 23

Now that we have discussed the best practices to reduce the occurrences of this denial, it is time to look into an effective OA 23 denial code solution in case it is triggered:

• Start by understanding the adjudication details by reviewing remittance advice (RA) and explanation of benefits (EOB) from the prior payer(s).
• In the second step, perform a comparative analysis of adjustments and payments from the insurance payer with the expected payment amount as per the fee schedules and contracted rates.
• Next, check if any underpayments or disparities occurred during the adjudication process.
• You should then start collecting supporting documents, including medical records and claim copies required by the payer for appealing the denial.
• Then, connect with the insurance firm to discuss the denial and provide the required clarification supported by additional information.
• Also, follow the appeal submission process defined by the prior payer(s) and meet the resubmission deadline to increase your chances of getting paid.
• Keep a record of all communication with the insurance company for future reference.
• Monitor your appeal status and promptly follow up for timely resolution.
• If the insurer fails to provide a satisfactory resolution or upholds the denial, you may escalate your concern to higher-level personnel within the insurance firm.
• Regularly evaluate and improve your internal processes to reduce denial code 23 occurrences.

Bottom Line

Denial code 23 occurs when a patient is covered by multiple insurance policies and the primary payer’s adjudication impacts the reimbursement amount paid by the secondary payer. Several reasons, like incomplete documentation, incorrect coding, duplicate claim submission, and failure to verify patient eligibility, can trigger OA 23 denial code.  

However, with automation, accurate billing and coding, and timely appeals, you can reduce the effect of denial code 23 on your revenue cycle management (RCM). 

If you still don’t feel confident, you can get professional denial management services from a reputable RCM provider like MediBill MD.