How To Fix Denial Code P27 | Common Reasons, Next Steps & How To Avoid It

Denial Code P27 means that payment has been denied based on the Liability Coverage Benefits jurisdictional regulations and/or payment policies. This code is typically used for Property and Casualty Auto claims. In this article, we will explore the description of Denial Code P27, common reasons for its occurrence, next steps to resolve it, how to avoid it in the future, and provide example cases.

2. Description

Denial Code P27 is a specific code used when payment is denied due to the Liability Coverage Benefits jurisdictional regulations and/or payment policies. This code is primarily applicable to Property and Casualty Auto claims. When this denial code is received, it indicates that the insurance company will not make the payment based on the specific regulations or policies governing the liability coverage benefits.

2. Common Reasons

The most common reasons for Denial Code P27 are:

1. Jurisdictional Regulations: Denial Code P27 may occur when the claim does not meet the specific regulations set by the jurisdiction governing the liability coverage benefits. These regulations can vary depending on the location and the specific insurance policies in place.
2. Payment Policies: Insurance companies may have specific payment policies related to liability coverage benefits. If the claim does not comply with these policies, it may be denied under Denial Code P27.
3. Property and Casualty Auto Claims: Denial Code P27 is primarily used for Property and Casualty Auto claims. If the claim falls under this category and does not meet the necessary requirements, it may be denied using this code.

3. Next Steps

To resolve Denial Code P27, the following steps can be taken:

1. Review Jurisdictional Regulations: Carefully review the jurisdictional regulations governing the liability coverage benefits. Understand the specific requirements that need to be met for the claim to be eligible for payment.
2. Check Payment Policies: Familiarize yourself with the insurance company’s payment policies related to liability coverage benefits. Ensure that the claim adheres to these policies to avoid denial under Code P27.
3. Consult Insurance Policy Number Segment: If the denial is at the claim level, refer to the 835 Insurance Policy Number Segment (Loop 2100 Other Claim Related Information REF qualifier ‘IG’) to understand if the jurisdictional regulation applies and how it may impact the claim.
4. Refer to Healthcare Policy Identification Segment: If the denial is at the line level, consult the 835 Healthcare Policy Identification Segment (loop 2110 Service Payment information REF) to determine if the jurisdictional regulations apply and how they affect the claim.
5. Contact the Insurance Company: If there is any confusion or disagreement regarding the denial, reach out to the insurance company’s provider support. Discuss the specifics of the claim and seek clarification on the application of jurisdictional regulations and payment policies.
6. Make Necessary Adjustments: Based on the information obtained, make any necessary adjustments to the claim to ensure compliance with jurisdictional regulations and payment policies. This may involve providing additional documentation or modifying the claim details.

4. How To Avoid It

To avoid Denial Code P27 in the future, consider the following steps:

1. Understand Jurisdictional Regulations: Stay updated on the jurisdictional regulations governing liability coverage benefits. Regularly review any changes or updates to ensure compliance when submitting claims.
2. Follow Payment Policies: Familiarize yourself with the insurance company’s payment policies related to liability coverage benefits. Ensure that claims are submitted in accordance with these policies to minimize the risk of denial under Code P27.
3. Properly Categorize Claims: For Property and Casualty Auto claims, accurately categorize the claims to ensure they are processed correctly. This will help avoid denials under Denial Code P27 due to incorrect claim categorization.

5. Example Cases

Here are two examples of Denial Code P27:

• Example 1: A healthcare provider submits a claim for an auto accident injury treatment. However, the claim is denied under Denial Code P27 because it does not meet the specific jurisdictional regulations governing liability coverage benefits for auto accidents.
• Example 2: In another scenario, a provider submits a claim for property damage caused by a natural disaster. The claim is denied under Denial Code P27 as it does not comply with the payment policies related to liability coverage benefits for property damage claims.

Source: Claim Adjustment Reason Codes