How To Fix Denial Code 166 | Common Reasons, Next Steps & How To Avoid It

Denial Code 166 means that the services being billed were submitted after the payer’s responsibility for processing claims under the specific plan has ended. Below you can find the description, common reasons for denial code 166, next steps, how to avoid it, and examples.

2. Description

Denial Code 166 is a specific claim adjustment reason code (CARC) that indicates the services being billed were submitted after the payer’s responsibility for processing claims under the particular plan has ended. This means that the insurance company will not make any payment for the services rendered because the claim was submitted outside of the allowed timeframe.

2. Common Reasons

The most common reasons for denial code 166 are:

1. Missed Filing Deadline: One of the primary reasons for denial code 166 is the failure to submit the claim within the specified timeframe. Each insurance plan has its own set of rules and deadlines for claim submission, and if the claim is not filed within the required timeframe, it will be denied under code 166.
2. Terminated Coverage: If the patient’s insurance coverage has been terminated or expired before the claim is submitted, it will result in denial code 166. It is crucial to verify the patient’s insurance status and ensure that the coverage is active before providing services and submitting claims.
3. Out-of-Network Services: Denial code 166 may occur when services are provided by a healthcare provider who is not in the patient’s insurance network. In such cases, the insurance company may deny the claim as the services are not covered under the patient’s plan.
4. Non-Covered Services: If the services rendered are not covered under the patient’s insurance plan, the claim will be denied under code 166. It is essential to verify the coverage and benefits of the patient’s plan before providing services to avoid such denials.
5. Expired Authorization: Some insurance plans require prior authorization for certain services. If the authorization has expired or was not obtained before providing the services, the claim may be denied under code 166.

3. Next Steps

You can address denial code 166 by following these steps:

1. Review Filing Deadlines: Familiarize yourself with the specific filing deadlines for each insurance plan you work with. Ensure that claims are submitted within the required timeframe to avoid denials under code 166.
2. Verify Insurance Coverage: Before providing services, verify the patient’s insurance coverage and ensure that it is active. If the coverage has been terminated or expired, inform the patient and explore alternative payment options.
3. Check Network Status: Confirm whether you are an in-network provider for the patient’s insurance plan. If you are out-of-network, discuss the potential out-of-pocket costs with the patient before providing services.
4. Verify Coverage for Services: Before rendering services, verify that the services are covered under the patient’s insurance plan. If they are not covered, discuss alternative options with the patient or explore self-pay arrangements.
5. Obtain Prior Authorization: If the insurance plan requires prior authorization for specific services, ensure that the authorization is obtained before providing the services. Keep track of the authorization expiration dates and submit claims promptly.
6. Appeal the Denial: If you believe the denial under code 166 was incorrect or unjustified, gather any necessary documentation and submit an appeal to the insurance company. Provide evidence supporting the timely filing of the claim or any other relevant information that may overturn the denial.

4. How To Avoid It

To prevent denial code 166 in the future, consider the following steps:

1. Stay Informed: Stay updated on the filing deadlines and requirements of the insurance plans you work with. Regularly review and communicate any changes to your billing and administrative staff.
2. Verify Insurance Coverage: Always verify the patient’s insurance coverage and eligibility before providing services. Confirm that the coverage is active and that the services are covered under the patient’s plan.
3. Network Participation: If you are not an in-network provider for a patient’s insurance plan, inform the patient about potential out-of-network costs and explore alternative options.
4. Obtain Prior Authorization: Familiarize yourself with the services that require prior authorization and ensure that the necessary authorizations are obtained before providing the services.
5. Accurate Documentation: Maintain accurate and detailed documentation of all services provided, including dates, codes, and any relevant authorizations. This documentation will be crucial in case of any disputes or denials.

5. Example Cases

Below are two examples of denial code 166:

• Example 1: A healthcare provider submits a claim for services rendered six months after the patient’s insurance coverage terminated. The claim is denied under code 166 as it was submitted after the payer’s responsibility for processing claims under the plan had ended.
• Example 2: A provider fails to obtain prior authorization for a specialized procedure before providing the service. The claim is subsequently denied under code 166 due to the lack of authorization.

Source: Claim Adjustment Reason Codes