How To Fix Denial Code 227 | Common Reasons, Next Steps & How To Avoid It

Denial Code 227 means that the information requested from the patient, insured, or responsible party was not provided or was insufficient/incomplete. This denial code requires at least one Remark Code to be provided, which can be either the NCPDP Reject Reason Code or a Remittance Advice Remark Code that is not an ALERT. In this article, we will explore the description of Denial Code 227, common reasons for its occurrence, next steps to resolve the denial, how to avoid it in the future, and provide examples of cases related to this denial code.

2. Description

Denial Code 227 is a specific Claim Adjustment Reason Code (CARC) that indicates the information requested from the patient, insured, or responsible party was either not provided or was insufficient/incomplete. This denial code requires additional Remark Codes to be provided, which can help identify the specific reason for the denial. These Remark Codes can be in the form of NCPDP Reject Reason Codes or Remittance Advice Remark Codes that are not ALERTs. Denial Code 227 is used to communicate to the healthcare provider that the necessary information was missing or inadequate, leading to the denial of the claim.

2. Common Reasons

The most common reasons for Denial Code 227 are:

1. Incomplete Patient Information: One of the common reasons for Denial Code 227 is when the patient’s information, such as name, date of birth, or insurance identification number, is missing or incomplete on the claim. Without accurate and complete patient information, the insurance company cannot process the claim properly, resulting in denial.
2. Missing Supporting Documentation: Some claims require additional supporting documentation to be submitted along with the claim form. If the necessary documentation, such as medical records, invoices, or prior authorization forms, is not provided or is incomplete, Denial Code 227 may be issued. Insufficient supporting documentation can hinder the insurance company’s ability to assess the claim’s validity and make an informed decision.
3. Invalid or Expired Insurance Coverage: Denial Code 227 can occur when the patient’s insurance coverage is invalid or has expired at the time of service. This can happen if the patient’s policy has been terminated, the insurance card is no longer valid, or the coverage period has ended. Without active and valid insurance coverage, the claim cannot be processed, leading to denial.
4. Missing Authorization or Referral: Certain healthcare services require prior authorization or referral from the insurance company or primary care physician. If the necessary authorization or referral is not obtained or is not included with the claim, Denial Code 227 may be issued. Lack of proper authorization or referral can result in the claim being denied due to failure to meet the insurance company’s requirements.
5. Incomplete Billing Information: Denial Code 227 can also occur if there are errors or omissions in the billing information submitted with the claim. This can include missing procedure codes, incorrect billing codes, or incomplete itemized statements. Incomplete billing information can make it difficult for the insurance company to accurately process the claim, leading to denial.

3. Next Steps

To resolve Denial Code 227, the following steps can be taken:

1. Review the Denial Explanation: Carefully review the explanation provided with Denial Code 227 to understand the specific reason for the denial. Look for any additional Remark Codes or instructions that may provide further clarification.
2. Collect the Missing Information: Identify the specific information or documentation that was missing or incomplete. Contact the patient, insured, or responsible party to obtain the necessary information or supporting documentation. Ensure that all required fields on the claim form are completed accurately.
3. Submit an Appeal or Corrected Claim: If the denial was due to missing or incomplete information, submit an appeal or corrected claim with the updated and complete information. Include any additional Remark Codes or supporting documentation that may be required to address the denial.
4. Follow Up with the Insurance Company: After submitting the appeal or corrected claim, follow up with the insurance company to ensure that the claim is being processed correctly. Communicate any additional information or documentation that may be requested by the insurance company.
5. Document and Track: Keep a record of all communication, including dates, times, and the individuals involved, regarding the resolution of Denial Code 227. This documentation can be useful in case further action or escalation is required.

4. How To Avoid It

To avoid Denial Code 227 in the future, consider the following steps:

1. Verify Patient Information: Ensure that all patient information, including name, date of birth, and insurance identification number, is accurate and complete before submitting the claim. Double-check the information against the patient’s insurance card or records.
2. Obtain Necessary Authorizations and Referrals: Determine if the healthcare services require prior authorization or referral. Obtain the necessary approvals or referrals from the insurance company or primary care physician before providing the services. Include the authorization or referral documentation with the claim.
3. Submit Complete and Accurate Documentation: Include all required supporting documentation, such as medical records, invoices, or prior authorization forms, with the claim. Ensure that the documentation is complete, legible, and relevant to the services provided.
4. Stay Updated on Insurance Coverage: Regularly verify the patient’s insurance coverage to ensure it is active and valid. Check for any changes in coverage, such as policy terminations or expiration dates, before providing services.
5. Train Staff on Proper Billing Procedures: Provide training to billing and administrative staff on the proper procedures for submitting claims. Emphasize the importance of accurate and complete billing information, including procedure codes, billing codes, and itemized statements.

5. Example Cases

Here are two examples of Denial Code 227:

• Example 1: A healthcare provider submits a claim for a surgical procedure but fails to include the required pre-authorization from the insurance company. As a result, Denial Code 227 is issued, indicating that the necessary authorization was missing.
• Example 2: A claim is submitted with incomplete patient information, including a missing date of birth. The insurance company denies the claim under Denial Code 227, stating that the information requested from the patient was insufficient.

Source: Claim Adjustment Reason Codes