What Steps Should You Take After a Co-97 Denial Code Description?

Claim denials have always been a challenge for medical practices, and among the various coding errors that cause denials, one of the most common is the CO-97 denial code. Several RCM organizations have also reported the CO-97 denial code as one of the top 10 denial codes. This denial code indicates that a claim or service has been denied because it is considered included in another service already billed or is not separately payable.

Claims that don’t adhere to the National Correct Coding Initiative (NCCI) changes provided by the Centres for Medicare & Medicaid Services (CMS) are frequently rejected because the majority of commercial insurers and government payers follow these rules. Ignoring recurring CO-97 Denial Code issues can increase Accounts Receivable (A/R) days, reduce cash flow, and create unnecessary administrative work for billing teams.

According to industry estimates, 5% to 10% of all medical claims are refused on their first submission, whereas almost 65% of denied claims are recoverable when handled promptly. If your billing team regularly sees this denial, understanding what it means, why it occurs, and how to prevent it can significantly improve your practice’s revenue cycle.

What causes the CO-97 denial code

Duplicate submissions, incorrect modifiers, other coding errors, and bundled services are the most common causes of the CO-97 denial code.

Let’s explore these causes of the CO 97 denial code description in medical billing in detail:

• Duplicate Claim Submission

Submitting the same service more than once is one of the most common reasons for receiving the CO-97 Denial Code. Insurance companies recognize duplicate claims and automatically deny additional submissions.

• Bundled Procedures

Many medical procedures are reimbursed as part of a larger service rather than individually. When separately billable services are submitted without meeting payer requirements, the claim is denied under the CO-97 Denial Code Description.

• Incorrect Modifier Usage

Modifiers such as -25, -59, or -XU help explain when services should be reimbursed separately. Missing or incorrect modifiers frequently trigger CO-97 denials.

• Coding Errors

Incorrect CPT, ICD-10, or HCPCS codes can cause insurers to identify procedures as bundled when they should actually be paid separately. Accurate coding remains one of the most important aspects of denial management in medical billing.

• Payer-Specific Billing Rules

Every insurance payer has unique reimbursement policies. A claim accepted by one insurance company may receive a CO-97 Denial Code from another because of different bundling guidelines or documentation requirements.

Understanding the causes of the CO-97 denial code and resolving them can be a lengthy process that often takes weeks, delaying reimbursements and causing revenue leakage. To avoid this, many practices outsource medical billing services to a medical billing company in the USA, such as AmFac Medical Management.

We review the payer’s remittance advice (ERA/EOB) to determine the exact denial reason. Our billing specialists verify whether the denial resulted from incorrect code bundling, duplicate billing, modifier issues, payer-specific edits, or missing documentation. After identifying the root cause, we correct the claim, apply appropriate modifiers or supporting documentation when required, and resubmit or appeal the claim according to the payer’s guidelines. We also track recurring CO-97 denial trends across payers and implement preventive measures to reduce future denials, helping healthcare providers improve claim acceptance rates and protect revenue.

Steps to fix: Co-97 Denial Code

The CO-97 denial code can often be resolved by applying the correct modifier. The steps to fix the CO-97 denial code in medical billing include reviewing the claim, verifying the details, checking modifier usage, resubmitting the claim, and appealing incorrect denials.

Here are the detailed steps to fix the CO-97 denial code:

Review the Explanation of Benefits (EOB)

The first step is to carefully review the payer’s Explanation of Benefits (EOB) or Electronic Remittance Advice (ERA). The denial reason often provides valuable insight into why the claim was rejected and what corrective action is required.

Verify Coding Accuracy

Check whether the CPT, HCPCS, and ICD-10 codes were submitted correctly. Confirm that the services were coded according to current payer guidelines.

Check Modifier Usage

Many CO-97 denials occur because appropriate modifiers were omitted or incorrectly assigned. Review modifiers such as -25, -59, XE, XP, XS, and XU to determine whether the services qualify for separate reimbursement.

Correct Documentation Issues

If supporting documentation is missing, update the patient’s medical record before resubmitting the claim.

Submit an Appeal if Appropriate

If the denial resulted from an incorrect payer decision, prepare a formal appeal with supporting clinical documentation.

Monitor the Claim Until Resolution

Following up after resubmission is just as important as correcting the claim itself. Consistent follow-up ensures the claim doesn’t remain unresolved.

According to an analysis of CMS National Correct Coding Initiative (NCCI) edits, about 66% of bundling edits can be corrected with the right modifier and proper documentation, while 34% cannot be fixed using any modifier. At AmFac Medical Management, we analyse the exact reason for rejection. 

Conclusion 

The CO-97 Denial Code Description is essential for reducing claim denials and protecting your practice’s revenue. Most CO-97 Denial Code issues stem from coding errors, bundled services, missing modifiers, or payer-specific billing rules, but they can often be prevented with accurate documentation and proactive claim reviews. If your practice wants to reduce denials and improve reimbursement rates, connect with us to resolve claims faster and keep your revenue cycle running efficiently.