Denial Code CO-22: Causes, Solutions, and Prevention Tips

Denial Code CO-22 can be a significant hurdle in the claims process, directly affecting the revenue stream of your physical therapy practice. By effectively managing these denials, you can minimize disruptions in payment and ensure that your services are fully reimbursed. This blog will guide you through what CO-22 entails, why it matters, and how you can address and prevent these denials.

What is Denial Code CO-22?

Denial Code CO-22 indicates that a claim has been denied because the procedure code submitted is considered to be part of another service or procedure that was already paid. Essentially, the payer believes that the billed service is bundled with another service, and therefore, additional payment is not warranted.

Why Does CO-22 Matter?

CO-22 denials can lead to financial losses and increased administrative workload due to the need for resubmissions and appeals. Understanding how to handle these denials is essential for maintaining the financial stability of your practice and ensuring timely reimbursement for all services provided.

Deconstructing a CO-22 Denial: What Went Wrong and How to Fix It

Example:

• Initial Billing:
  • CPT 97110: Therapeutic Exercise
  • CPT 97530: Therapeutic Activities

• Outcome: CPT 97530 (Therapeutic Activities) was denied under CO-22 because the payer considered it bundled with CPT 97110 (Therapeutic Exercise).

Remedy:

1. Review the Denial Reason: Examine the Explanation of Benefits (EOB) or Remittance Advice (RA) to confirm the bundling issue.
2. Consult Payer Guidelines: Refer to the payer’s policies to determine if a modifier can be used to unbundle the services.
3. Resubmit with Modifiers: If applicable, resubmit the claim with the appropriate modifier, such as Modifier 59, to indicate that the service was separate and distinct from the other services provided.

• Corrected Billing:
  • CPT 97110: Therapeutic Exercise
  • CPT 97530-59: Therapeutic Activities (with Modifier 59 to indicate it was separate from CPT 97110)

Actionable Steps: How to Address a CO-22 Denial

1. Analyze the Denial: Carefully review the EOB or RA to understand the exact reason for the denial.
2. Gather Supporting Documentation: Compile all relevant documentation, including clinical notes and payer guidelines, that demonstrate the distinct nature of the services provided.
3. Correct and Resubmit: Make necessary corrections, such as applying the appropriate modifiers, and resubmit the claim.
4. Follow Up: Monitor the resubmitted claim and be prepared to appeal if the denial persists.

Common Causes of CO-22 Denials

1. Bundling of Services: The payer considers the billed service as included in another service provided during the same encounter.
2. Incorrect or Missing Modifiers: Failure to use modifiers correctly to indicate distinct procedural services can lead to denials.
3. Inadequate Documentation: Lack of clear documentation to justify that the services were separate and necessary.

Proactive Prevention: Avoiding CO-22 Denials

Pre-Claim Submission Checklist:

• Verify Bundling Rules: Check the payer’s guidelines to ensure that services are not incorrectly bundled.
• Ensure Correct Modifier Usage: Apply modifiers correctly, especially Modifier 59, when services are distinct and separate.
• Double-Check Documentation: Ensure that documentation clearly supports the distinct nature of each service billed.

Training and Best Practices:

• Train your billing staff on payer-specific bundling rules and the proper use of modifiers.
• Implement best practices for thorough and accurate documentation to support all services provided.

Technology and Tools:

• Use billing software that includes checks for bundling errors and the correct application of modifiers.
• Leverage claim scrubbing tools that identify potential bundling issues before claim submission.

Conclusion: Protect Your Practice’s Revenue with Expert Denial Management

Denial Code CO-22 can be a challenging aspect of the billing process, but with a clear understanding and proactive approach, your practice can minimize its impact. By mastering the correct use of modifiers, ensuring clear documentation, and carefully reviewing payer policies, you can reduce the risk of CO-22 denials and safeguard your practice’s revenue.

Take Action with SPRY

Managing denials like CO-22 doesn’t have to be daunting. SPRY’s advanced physical therapy software simplifies the billing process, helps identify potential bundling errors, and ensures your practice receives the payments it deserves. Schedule a demo today to see how SPRY can improve your billing and revenue cycle management.

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