How To Fix Denial Code 273 | Common Reasons, Next Steps & How To Avoid It

Denial Code 273 means that the coverage or program guidelines have been exceeded, resulting in the denial of a claim. In this article, we will provide a detailed description of denial code 273, 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 273 cases.

2. Description

Denial Code 273 is a Claim Adjustment Reason Code (CARC) that indicates that the coverage or program guidelines set by the insurance company or healthcare program have been exceeded. This means that the services or treatments provided are not eligible for reimbursement because they go beyond the specified limits or restrictions outlined in the coverage or program guidelines.

2. Common Reasons

The most common reasons for denial code 273 include:

  1. Service Limitations: Denial code 273 may occur when the services rendered exceed the maximum allowable limit set by the insurance company or healthcare program. This could include limitations on the number of visits, procedures, or treatments covered within a specific time period.
  2. Non-Covered Services: Certain services or treatments may not be covered under the insurance policy or healthcare program. If a claim is submitted for a non-covered service, it will be denied under code 273.
  3. Out-of-Network Providers: If the healthcare provider is not within the network specified by the insurance company or healthcare program, the claim may be denied under code 273. This denial can occur even if the services provided are within the coverage guidelines.
  4. Pre-Authorization Requirements: Some insurance plans or healthcare programs require pre-authorization for certain services or treatments. If the necessary pre-authorization was not obtained before providing the service, the claim may be denied under code 273.
  5. Exceeded Benefit Limits: Denial code 273 can also occur when the total benefits or coverage limits for a specific service or treatment have been exhausted. Once the maximum benefit amount has been reached, any additional claims for that service will be denied.

3. Next Steps

If you receive a denial under code 273, follow these next steps to resolve the issue:

  1. Review Coverage Guidelines: Carefully review the coverage guidelines provided by the insurance company or healthcare program to understand the specific limitations or restrictions that have been exceeded.
  2. Verify Claim Information: Double-check the claim information, including the services provided, dates of service, and any pre-authorization requirements. Ensure that all information is accurate and in line with the coverage guidelines.
  3. Contact Insurance Company or Program: Reach out to the insurance company or healthcare program to discuss the denial and seek clarification on the specific reasons for the denial. This will help you understand if there was an error or if there are additional steps you can take to resolve the issue.
  4. Appeal the Denial: If you believe the denial was incorrect or unjustified, you have the option to appeal the decision. Gather any supporting documentation, such as medical records or additional information, to strengthen your case during the appeal process.
  5. Explore Alternative Payment Options: If the denial is upheld and the services provided are not covered, discuss alternative payment options with the patient. This could include setting up a payment plan or exploring other financial assistance programs that may be available.

4. How To Avoid It

To avoid denial code 273 in the future, consider the following tips:

  1. Verify Coverage and Guidelines: Before providing any services or treatments, verify the patient’s insurance coverage and thoroughly review the coverage guidelines. Ensure that the services being offered align with the specified limits and restrictions.
  2. Obtain Pre-Authorization: If pre-authorization is required for certain services, make sure to obtain it before providing the service. This will help prevent denials based on lack of pre-authorization.
  3. Stay Within Network: If possible, ensure that the healthcare provider is within the network specified by the insurance company or healthcare program. This will help avoid denials based on out-of-network providers.
  4. Communicate with Patients: Clearly communicate with patients about their insurance coverage and any limitations or restrictions that may apply. This will help manage expectations and prevent surprises or dissatisfaction related to denied claims.
  5. Regularly Review Benefits: Stay updated on the patient’s benefit limits and coverage details. Regularly review the remaining benefits to ensure that services are not provided once the maximum benefit amount has been reached.

5. Example Cases

Here are two examples of denial code 273:

  • Example 1: A patient undergoes a series of physical therapy sessions for a specific condition. However, the insurance policy only covers a maximum of 10 sessions per year. If the patient exceeds this limit, any additional claims for physical therapy sessions will be denied under code 273.
  • Example 2: A healthcare provider performs a procedure that requires pre-authorization from the insurance company. However, the provider fails to obtain the necessary pre-authorization before performing the procedure. As a result, the claim is denied under code 273.

Source: Claim Adjustment Reason Codes

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