How To Fix Denial Code 40 | Common Reasons, Next Steps & How To Avoid It

Denial Code 40 means that charges do not meet qualifications for emergent/urgent care. This denial code indicates that the insurance company will not make payment for the billed service because it does not meet the criteria for emergent or urgent care. In this article, we will provide a description of denial code 40, 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 40 cases.

2. Description

Denial Code 40 is a Claim Adjustment Reason Code (CARC) that signifies charges that do not meet the qualifications for emergent/urgent care. This means that the service provided does not meet the criteria set by the insurance company for emergent or urgent care. As a result, the insurance company will deny payment for the billed service.

2. Common Reasons

The most common reasons for denial code 40 are:

1. Lack of Medical Necessity: One of the main reasons for denial code 40 is the lack of medical necessity. Insurance companies have specific criteria that determine whether a service qualifies as emergent or urgent care. If the service does not meet these criteria, it will be denied under denial code 40.
2. Incorrect Coding: Another common reason for denial code 40 is incorrect coding. If the service is not coded correctly or the documentation does not support the level of urgency or emergency, the claim may be denied under this code.
3. Missing or Incomplete Documentation: Insufficient or incomplete documentation can also lead to denial code 40. If the necessary documentation to support the emergent or urgent nature of the service is missing or incomplete, the claim may be denied.
4. Out-of-Network Provider: If the provider is not in the insurance company’s network, the claim may be denied under denial code 40. Insurance companies often have specific requirements for emergent or urgent care services, and if the provider is not in-network, the claim may not meet the qualifications.

3. Next Steps

If you receive a denial under code 40, here are the next steps to resolve the denial:

1. Review the Denial Explanation: Carefully review the denial explanation provided by the insurance company. Understand the specific reason for the denial and what criteria the service did not meet.
2. Check for Coding Errors: Verify that the service was coded correctly. Ensure that the appropriate codes were used to indicate the level of urgency or emergency. If there are any coding errors, correct them and resubmit the claim.
3. Gather Supporting Documentation: If the denial was due to missing or incomplete documentation, gather all the necessary supporting documentation. This may include medical records, test results, or any other documentation that demonstrates the emergent or urgent nature of the service.
4. Submit an Appeal: If you believe that the denial was incorrect or unjustified, submit an appeal to the insurance company. Include all the relevant documentation and a detailed explanation of why you believe the service meets the qualifications for emergent or urgent care.
5. Follow Up: Follow up with the insurance company to ensure that your appeal is being processed. Stay in communication with them and provide any additional information they may request.

4. How To Avoid It

To avoid denial code 40 in the future, consider the following tips:

1. Understand Insurance Criteria: Familiarize yourself with the insurance company’s criteria for emergent or urgent care. Ensure that you are aware of the specific requirements and document accordingly.
2. Accurate Coding: Ensure that the services are coded accurately and reflect the level of urgency or emergency. Use the appropriate codes to indicate the nature of the service.
3. Complete Documentation: Make sure that all documentation is complete and supports the emergent or urgent nature of the service. Include any relevant medical records, test results, or other supporting documentation.
4. Verify Provider Network: Check if the provider is in-network with the insurance company. If not, consider referring the patient to an in-network provider for emergent or urgent care services.

5. Example Cases

Here are two examples of denial code 40:

• Example 1: A patient visits an out-of-network emergency room for a non-emergent condition. The claim is denied under denial code 40 because the service does not meet the qualifications for emergent care.
• Example 2: A provider submits a claim for an urgent care visit but fails to include the necessary documentation to support the level of urgency. The claim is denied under denial code 40 due to insufficient documentation.

Source: Claim Adjustment Reason Codes