How To Fix Denial Code 272 | Common Reasons, Next Steps & How To Avoid It

Denial Code 272 means that the claim has been denied because the coverage or program guidelines were not met. In this article, we will provide a detailed description of Denial Code 272, common reasons for its occurrence, next steps to resolve the denial, tips on how to avoid it in the future, and examples of cases related to this denial code.

2. Description

Denial Code 272 is a Claim Adjustment Reason Code (CARC) that indicates the denial of a claim due to the failure to meet the coverage or program guidelines. This means that the services or procedures billed do not comply with the specific requirements set by the insurance company or the program under which the claim is being processed. As a result, the claim is not eligible for reimbursement.

2. Common Reasons

The most common reasons for Denial Code 272 include:

1. Lack of Prior Authorization: Some insurance plans or programs require prior authorization for certain services or procedures. If the provider fails to obtain the necessary authorization before rendering the service, the claim may be denied under Code 272.
2. Exceeding Maximum Limit: Certain insurance plans or programs have limitations on the number of times a specific service or procedure can be performed within a given time period. If the provider submits a claim for a service that exceeds the maximum limit, it will be denied under Code 272.
3. Non-Covered Services: Insurance plans or programs may have specific exclusions for certain services or procedures. If the provider bills for a service that is not covered under the patient’s policy or program, the claim will be denied under Code 272.
4. Incorrect Coding: Inaccurate coding or billing information can lead to a denial under Code 272. If the service or procedure is coded incorrectly, it may not meet the coverage or program guidelines, resulting in the denial of the claim.
5. Documentation Insufficiency: Some insurance plans or programs require specific documentation to support the medical necessity of a service or procedure. If the provider fails to provide the required documentation, the claim may be denied under Code 272.

3. Next Steps

To resolve Denial Code 272, the following steps can be taken:

1. Review Coverage Guidelines: Carefully review the coverage guidelines provided by the insurance company or program to understand the specific requirements for the denied service or procedure.
2. Check for Prior Authorization: If the denial is due to lack of prior authorization, determine if the service or procedure requires authorization and if it was obtained. If not, consider submitting a retroactive authorization request or appealing the denial with supporting documentation.
3. Verify Maximum Limit: If the denial is related to exceeding the maximum limit, confirm the allowed frequency for the service or procedure. If the claim was submitted correctly, consider appealing the denial with additional information justifying the medical necessity for exceeding the limit.
4. Review Coverage Exclusions: If the denial is based on non-covered services, review the patient’s policy or program guidelines to ensure that the service or procedure is indeed excluded. If there is evidence that the service should be covered, consider appealing the denial with supporting documentation.
5. Check Coding Accuracy: If the denial is due to coding errors, review the coding used for the service or procedure. Ensure that it accurately reflects the nature of the service and complies with the coverage or program guidelines. If necessary, correct the coding and resubmit the claim.
6. Provide Required Documentation: If the denial is due to insufficient documentation, gather the necessary supporting documentation to demonstrate the medical necessity of the service or procedure. Include this documentation when resubmitting the claim or appealing the denial.

4. How To Avoid It

To avoid Denial Code 272 in the future, consider the following tips:

1. Verify Coverage Guidelines: Familiarize yourself with the coverage guidelines provided by the insurance company or program. Understand the specific requirements for each service or procedure to ensure compliance.
2. Obtain Prior Authorization: Determine if any services or procedures require prior authorization. Make sure to obtain the necessary authorization before rendering the service to avoid denials based on lack of authorization.
3. Monitor Maximum Limits: Keep track of the allowed frequency for services or procedures with maximum limits. Ensure that claims are not submitted for services that exceed the specified limits.
4. Review Coverage Exclusions: Regularly review the patient’s policy or program guidelines to identify any exclusions for services or procedures. Avoid billing for services that are explicitly excluded.
5. Ensure Accurate Coding: Use accurate and up-to-date coding for all services and procedures. Regularly train coding staff to stay updated with the latest coding guidelines and ensure compliance with coverage or program requirements.
6. Document Medical Necessity: Maintain thorough and accurate documentation to support the medical necessity of services or procedures. Include all relevant information that demonstrates the need for the service or procedure.

5. Example Cases

Here are two examples of denial cases related to Denial Code 272:

• Example 1: A provider submits a claim for a specialized imaging procedure that requires prior authorization. However, the provider failed to obtain the necessary authorization before performing the procedure. As a result, the claim is denied under Code 272.
• Example 2: A provider bills for a service that is explicitly excluded from the patient’s insurance policy. Despite the service being medically necessary, the claim is denied under Code 272 due to the coverage exclusion.

Source: Claim Adjustment Reason Codes