Every healthcare facility, regardless of its orientation (hospital, individual, or group practice), can agree on one thing – the denial rate is the most prominent antagonist impacting its financial health. But, like every good story, there is also a HERO! ‘Billing best practices’ – as 86% of claim denials are preventable.
Thus, as a leading medical billing company, we started a blog series to educate providers on addressing and preventing different denial codes. This guide will help you understand what leads to the PR 227 denial code and share some mitigation strategies you can implement to prevent it in the future.
So, without further ado, let’s get started!
PR 227 Denial Code – Description
The denial code 227 is triggered when requested information from the patient, or the insured/responsible party is incomplete or not provided. It is a Claim Adjustment Reason Code (CARC) with the Group Code PR – ‘patient responsibility’- to denote that the liability of payment adjustment falls on the patient.
The PR 227 denial code includes at least one Remark Code that further explains the reason for the denial, such as a Remittance Advice Remark Code (RARC) that is not an ALERT or an NCPDP Reject Reason Code (in the case of a pharmaceutical denial).
Reasons for PR 227 Denial Code
You may receive the denial code 227 when information such as Coordination of Benefits (COB) or other details (e.g., contact details, insurance policy number, secondary insurance payer’s details) are requested from the patient but not provided or are incomplete. For the unversed, COB helps determine which insurance is primary, secondary, or tertiary and the order of payment between multiple payers.
The insurance payer typically sends a letter requesting information from the patient, so it may take time to respond. Thus, you should wait at least 15-30 days from the date the letter was sent before releasing the bill to the patient and letting them be responsible for the medical charges.
PR 227 Denial Code – Management & Resolution
If you receive denial code 227 on any of your submitted claims, then below are the steps you can take to address and resolve it:
- Scenario # 1 – In case the insurance company has requested COB or other information from the patient by sending a letter and has already received a response. You should ask them to reprocess the claim. You must also arrange a follow-up with the representative for an estimated turnaround time.
- Scenario # 2 – It is possible that the payer requested COB or other information from the patient via a letter but failed to receive a response. Thus, in this situation, you should release the medical claim to the patient.
- Scenario # 3 – What should be the best course of action if the insurance provider issued a letter to the patient due to denial code 227, but the 30-day period has not ended? It is advisable to halt releasing the claim to the patient. However, after the deadline, verify whether the requested details were provided. If not, you can bill the patient for the rendered care services.
- Scenario # 4 – When you receive the PR 227 denial code, and the claim is pending due to COB updation, you can check the patient’s payment history to see whether any other insurance company made a payment on or close to the date of service (DoS) as the primary payer. If yes, you can submit the medical claim to that payer after verifying eligibility.
- Scenario # 5 – You may encounter a situation where the payer flags the claim for denial code 227 but does not issue a letter to the patient. If this happens, bill the claim to the patient.
How to Prevent Denial Code PR 227 Denial Code?
Now that we have shared the PR 227 denial code description, its reasons, and how to resolve it using different scenarios, it is time to discuss the effective strategies that can help reduce its occurrence.
Applying the following strategies can significantly decrease your denial rate and improve your practice revenue cycle.
Enhance Patient Communication
Educate your staff on effective communication strategies to strengthen provider-patient relationships. It will help you gather all necessary information, such as COB details from patients, accurately and timely, mitigating the risk of denial code 227.
Leverage Technology
Another preventive strategy is to streamline your practice’s data collection workflow by implementing online portals and electronic forms. It will enable you to keep patient data and insurance eligibility details up-to-date, reducing the likelihood of denials related to missing or outdated patient details.
Improve Claim Submission Process
The best strategy to avoid denial code 227 or any other denial is to ensure accuracy. One way to achieve this is by adding a review layer to your claim creation process to ensure precise claim filing and comprehensive documentation. Besides, you can use claim scrubbing tools to alert you if there are coding errors or missing information.
Stay Current on Payer Guidelines
Every insurance company has its specific guidelines and policies. Also, the payers may review and update their requirements over time. Thus, we recommend establishing open communication lines with insurance companies and keeping up-to-date on their billing guidelines to ensure timely reimbursements and prevent the PR 227 denial code.
Additionally, it will help you stay updated when the payer sends a letter to the patient for missing details and whether or not they received a response within 30 days of issuing it.
Proactively Track Claim Status
Monitoring and tracking claim status through regular follow-ups is another best practice you should implement to prevent denial code 227. It will allow you to take prompt actions in case denial occurs.
Bottom Line
This guide discussed denial code 227, possible reasons behind its occurrence, how to address it, and some preventive strategies to avoid it. However, handling common denials in-house can seem overwhelming, especially when you don’t have the resources to set up an in-house billing team with certified professional coders (CPCs) and medical billing specialists.
Therefore, instead of juggling clinical and financial activities and failing at both, outsource denial management services to a leading medical billing company like MediBill MD. We offer denial resolution services to 45+ specialties across all 50 states of the US.
