How To Fix Denial Code 172 | Common Reasons, Next Steps & How To Avoid It

Denial Code 172 means that the payment is adjusted when performed or billed by a provider of a specific specialty. This denial code indicates that the insurance company will not fully reimburse the billed service due to the provider’s specialty. In this article, we will provide a description of denial code 172, common reasons for its occurrence, next steps to resolve the denial, tips on how to avoid it in the future, and examples of denial code 172 cases.

2. Description

Denial Code 172 is a claim adjustment reason code (CARC) that signifies that the payment for a service is adjusted when performed or billed by a provider of a particular specialty. This code is typically used to indicate that the insurance company will not fully reimburse the billed amount due to the provider’s specialty. The specific details regarding the adjustment can be found in the 835 Healthcare Policy Identification Segment, if present.

2. Common Reasons

The most common reasons for denial code 172 are:

1. Specialty Restrictions: Denial code 172 often occurs when the insurance policy has specific restrictions on reimbursement for services provided by certain specialties. These restrictions may be related to the type of service, the provider’s qualifications, or the network’s coverage policies. If the service is performed or billed by a provider whose specialty falls under these restrictions, the payment will be adjusted accordingly.
2. Out-of-Network Providers: Insurance plans may have limitations on reimbursement for services provided by out-of-network providers. If the provider’s specialty is not within the network or if the service is performed by an out-of-network provider, the payment may be adjusted under denial code 172.
3. Incorrect Billing Codes: In some cases, denial code 172 may occur due to errors in the billing codes used. If the service is not properly coded to reflect the provider’s specialty or if there are discrepancies between the billed service and the provider’s qualifications, the payment may be adjusted accordingly.
4. Policy Exclusions: Certain insurance policies may have exclusions for specific specialties or services. If the service falls under these exclusions, the payment may be adjusted under denial code 172.

3. Next Steps

If you receive denial code 172, here are the next steps to resolve the denial:

1. Review the Explanation of Benefits (EOB): Carefully review the EOB provided by the insurance company to understand the specific details of the adjustment. Look for any notes or explanations related to denial code 172.
2. Verify Provider’s Specialty: Confirm that the provider’s specialty aligns with the service billed. Ensure that the provider’s qualifications and credentials are accurately reflected in the claim.
3. Contact the Insurance Company: Reach out to the insurance company’s provider support to discuss the denial and seek clarification on the adjustment. Provide any necessary documentation or information to support your case.
4. Appeal the Denial: If you believe the denial was made in error or if you have additional information to support the claim, consider filing an appeal. Follow the insurance company’s appeal process and provide any relevant documentation to support your case.
5. Consider Network Participation: If the denial is due to the provider being out-of-network, evaluate the possibility of joining the insurance company’s network or referring the patient to an in-network provider to avoid future denials.

4. How To Avoid It

To prevent denial code 172 in the future, consider the following tips:

1. Verify Network Participation: Before providing services, ensure that the provider is part of the insurance company’s network. If the provider’s specialty is subject to restrictions, confirm that the service will be reimbursed according to the policy.
2. Accurate Billing Codes: Use the appropriate billing codes that accurately reflect the provider’s specialty and the service provided. Regularly review and update coding practices to ensure compliance with insurance policies.
3. Review Policy Exclusions: Familiarize yourself with the insurance policy’s exclusions and limitations. Be aware of any restrictions on reimbursement for specific specialties or services.
4. Communicate with Patients: Inform patients about any potential limitations or restrictions related to their insurance coverage. Discuss alternative options if their desired service falls under denial code 172.

5. Example Cases

Here are two examples of denial code 172:

• Example 1: A patient seeks treatment from a chiropractor for a back injury. However, their insurance policy explicitly excludes coverage for chiropractic services. As a result, the payment for the chiropractic treatment is adjusted under denial code 172.
• Example 2: A provider submits a claim for a specialized surgical procedure that requires a specific qualification. However, the provider’s qualifications do not align with the required specialty for the procedure. The payment for the procedure is adjusted under denial code 172.

Source: Claim Adjustment Reason Codes