Denial Code 187 means that a claim has been denied because the payment is being allocated towards the patient’s Consumer Spending Account (CSA), which includes Flexible Spending Account (FSA), Health Savings Account (HSA), Health Reimbursement Account (HRA), or other similar accounts. In this article, we will provide a detailed description of denial code 187, 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 187 cases.
2. Description
Denial Code 187 is a Claim Adjustment Reason Code (CARC) that indicates the payment for the billed service has been denied because it is being allocated towards the patient’s Consumer Spending Account. This includes various types of accounts such as Flexible Spending Account (FSA), Health Savings Account (HSA), Health Reimbursement Account (HRA), and other similar accounts. The insurance company will not make the payment for the service as it is expected to be covered by the funds in the patient’s CSA.
2. Common Reasons
The most common reasons for denial code 187 are:
- Insufficient CSA Funds: Denial code 187 often occurs when the patient’s CSA does not have enough funds to cover the cost of the billed service. If the available balance in the CSA is insufficient, the insurance company will deny the claim and expect the patient to pay for the service out-of-pocket.
- Incorrect CSA Information: In some cases, denial code 187 may be triggered due to errors or discrepancies in the patient’s CSA information. This can include incorrect account numbers, invalid or expired CSA cards, or mismatched information between the claim and the CSA records. Such inaccuracies can lead to claim denials and require further verification and correction.
- Non-Covered Services: Certain services may not be eligible for reimbursement from the patient’s CSA. If the billed service falls under a category that is not covered by the CSA, the claim will be denied under code 187. It is important to review the CSA guidelines and ensure that the service is eligible for reimbursement before submitting the claim.
- Missing or Incomplete Documentation: Denial code 187 can also occur if the necessary documentation supporting the claim is missing or incomplete. This can include invoices, receipts, or other proof of payment from the CSA. Without proper documentation, the insurance company may deny the claim and request additional information to verify the payment from the CSA.
- Expired or Inactive CSA: If the patient’s CSA has expired or is no longer active, the insurance company will deny the claim under code 187. It is crucial to ensure that the patient’s CSA is valid and active before submitting the claim to avoid unnecessary denials.
3. Next Steps
To resolve denial code 187, follow these next steps:
- Verify CSA Balance: Contact the patient or the CSA administrator to confirm the available balance in the patient’s CSA. Ensure that there are sufficient funds to cover the cost of the billed service.
- Correct CSA Information: If there are any errors or discrepancies in the patient’s CSA information, such as incorrect account numbers or expired cards, work with the patient and the CSA administrator to update and correct the information.
- Review CSA Guidelines: Familiarize yourself with the guidelines and restrictions of the patient’s CSA. Ensure that the billed service is eligible for reimbursement from the CSA. If it is not covered, discuss alternative payment options with the patient.
- Provide Documentation: Gather all necessary documentation to support the claim, including invoices, receipts, or other proof of payment from the CSA. Ensure that the documentation is complete and accurately reflects the payment made from the CSA.
- Resubmit the Claim: Once you have verified the CSA balance, corrected any information, reviewed the guidelines, and gathered the necessary documentation, resubmit the claim with the updated information and supporting documentation. Include a clear explanation of how the service is eligible for reimbursement from the CSA.
- Follow Up with the Insurance Company: After resubmitting the claim, follow up with the insurance company to ensure that they have received the updated claim and supporting documentation. Communicate any additional information or clarification they may require to process the claim successfully.
4. How To Avoid It
To avoid denial code 187 in the future, consider the following tips:
- Educate Patients: Provide clear and detailed information to patients about their CSA and its coverage limitations. Ensure that they understand which services are eligible for reimbursement and any requirements or restrictions associated with their CSA.
- Verify CSA Eligibility: Before providing services, verify the patient’s CSA eligibility and coverage. Confirm that the service is eligible for reimbursement from the CSA and that the patient’s account is active and has sufficient funds.
- Accurate Documentation: Maintain accurate and complete documentation of CSA payments and transactions. Keep records of invoices, receipts, and other proof of payment from the CSA to provide when submitting claims.
- Regularly Update CSA Information: Stay updated with the patient’s CSA information, including account numbers, expiration dates, and any changes in coverage or eligibility. Regularly verify the accuracy of the information to avoid claim denials due to incorrect or outdated CSA details.
- Review CSA Guidelines: Familiarize yourself with the guidelines and restrictions of different CSAs. Understand the specific requirements for reimbursement and ensure that the services provided align with those guidelines.
5. Example Cases
Here are two examples of denial code 187:
- Example 1: A patient submits a claim for a medical procedure costing $500, expecting it to be covered by their HSA. However, their HSA balance is only $200, resulting in denial code 187. The patient will need to pay the remaining $300 out-of-pocket.
- Example 2: A provider mistakenly submits a claim for a service that is not eligible for reimbursement from the patient’s FSA. The claim is denied under code 187, and the patient is responsible for the full payment of the service.
