How To Fix Denial Code 198 | Common Reasons, Next Steps & How To Avoid It

Denial Code 198 means that a claim has been denied because the precertification, notification, authorization, or pre-treatment requirement has been exceeded. Below you can find the description, common reasons for denial code 198, next steps, how to avoid it, and examples.

2. Description

Denial Code 198 is a Claim Adjustment Reason Code (CARC) and is described as ‘Precertification/Notification/Authorization/Pre-treatment Exceeded’. This denial code indicates that the claim has been denied because the requirement for precertification, notification, authorization, or pre-treatment has been exceeded. In simpler terms, the necessary steps or approvals needed before the treatment or service was provided were not obtained or were not obtained within the required timeframe.

2. Common Reasons

The most common reasons for denial code 198 are:

1. Lack of Prior Authorization: Many insurance plans require prior authorization for certain treatments, procedures, or services. If the provider fails to obtain the necessary authorization before providing the service, the claim may be denied under denial code 198.
2. Expired Authorization: Even if the provider initially obtained authorization, there may be a time limit on its validity. If the service is provided after the expiration date of the authorization, the claim may be denied under denial code 198.
3. Missing or Incomplete Documentation: Insurance companies often require specific documentation to support the need for precertification, notification, authorization, or pre-treatment. If the required documentation is missing or incomplete, the claim may be denied under denial code 198.
4. Failure to Follow Proper Procedures: Insurance companies may have specific procedures that providers must follow to obtain the necessary precertification, notification, authorization, or pre-treatment. If the provider fails to follow these procedures, the claim may be denied under denial code 198.
5. Untimely Submission: Some insurance plans have strict timelines for obtaining precertification, notification, authorization, or pre-treatment. If the provider fails to submit the necessary information within the required timeframe, the claim may be denied under denial code 198.

3. Next Steps

You can fix denial code 198 as follows:

1. Review Authorization Requirements: Familiarize yourself with the specific precertification, notification, authorization, or pre-treatment requirements of each insurance plan you work with. Understand the necessary steps and documentation needed to obtain approval.
2. Obtain Prior Authorization: Ensure that you obtain the necessary prior authorization before providing any treatments, procedures, or services that require it. Follow the insurance company’s procedures and submit all required documentation in a timely manner.
3. Document and Submit Properly: Make sure that all documentation supporting the need for precertification, notification, authorization, or pre-treatment is complete and accurate. Submit the documentation according to the insurance company’s guidelines and within the required timeframe.
4. Appeal the Denial: If you believe that the denial was in error or if you have additional information to support the claim, you can appeal the denial. Follow the insurance company’s appeal process and provide any necessary documentation or explanations to support your case.
5. Improve Communication and Processes: Review your internal processes to ensure that all necessary steps for obtaining precertification, notification, authorization, or pre-treatment are followed consistently. Improve communication between your staff and insurance companies to ensure that all requirements are met.

4. How To Avoid It

You can prevent denial code 198 in the future as follows:

1. Verify Authorization Requirements: Before providing any treatments, procedures, or services, verify the specific precertification, notification, authorization, or pre-treatment requirements of each insurance plan. Ensure that you understand the necessary steps and documentation needed to obtain approval.
2. Obtain Prior Authorization Timely: Make it a priority to obtain the necessary prior authorization within the required timeframe. Follow the insurance company’s procedures and submit all required documentation promptly.
3. Document and Submit Accurately: Ensure that all documentation supporting the need for precertification, notification, authorization, or pre-treatment is complete and accurate. Double-check that you have included all necessary information and submit the documentation according to the insurance company’s guidelines.
4. Train Staff: Provide training to your staff on the specific precertification, notification, authorization, or pre-treatment requirements of each insurance plan. Make sure they understand the importance of following the proper procedures and submitting all necessary documentation in a timely manner.

5. Example Cases

Below are two examples of denial code 198:

• Example 1: A provider submits a claim for a surgical procedure that requires prior authorization. However, the provider failed to obtain the necessary authorization before performing the surgery. As a result, the claim is denied under denial code 198.
• Example 2: A provider obtains prior authorization for a series of physical therapy sessions. However, the authorization expires after a certain period of time, and the provider continues to provide the sessions after the expiration date. The claim for the sessions is denied under denial code 198.

Source: Claim Adjustment Reason Codes