How To Fix Remark Code M845 (RARC) | Common Reasons, Next Steps & How To Avoid It

Remark Code N645 means that there is a mark-up allowance. This code is used to indicate that a claim has been adjusted or denied due to a mark-up allowance issue. Understanding the reasons behind this code can help medical coders and healthcare providers address and resolve the issue effectively.

1. Description

Remark Code N645 signifies a mark-up allowance issue. The official description states: ‘Mark-up allowance.’ This code is used when a claim has been adjusted or denied due to a mark-up allowance problem. It is important to understand the specifics of this code to ensure accurate billing and reimbursement.

2. Common Reasons

1. Excessive mark-up: One of the common reasons for Remark Code N645 is when the mark-up on a service or item is deemed excessive. This means that the provider has charged significantly more than the usual and customary rate for the service or item.
2. Unjustified mark-up: Another reason for this code is when the mark-up on a service or item is not justified. This means that the provider has not provided sufficient documentation or evidence to support the higher charge.
3. Inadequate mark-up disclosure: Remark Code N645 may also be used when the provider has failed to disclose the mark-up amount or percentage to the patient or payer. Transparency in pricing is essential for accurate billing and reimbursement.
4. Violation of contractual agreements: If the provider has violated any contractual agreements with the payer regarding mark-up allowances, Remark Code N645 may be applied.

3. Next Steps

1. Review the mark-up: The first step in addressing Remark Code N645 is to review the mark-up on the service or item in question. Ensure that it is reasonable and justifiable based on industry standards and any contractual agreements.
2. Provide additional documentation: If the mark-up is deemed excessive or unjustified, provide additional documentation to support the higher charge. This may include detailed explanations, medical records, or other relevant information.
3. Communicate with the payer: Reach out to the payer to discuss the mark-up allowance issue. Clarify any misunderstandings, provide necessary documentation, and work towards a resolution.
4. Adjust the billing: If the mark-up is found to be excessive or unjustified, adjust the billing accordingly. This may involve reducing the mark-up to an acceptable level or removing it altogether.

4. How To Avoid It

1. Understand mark-up guidelines: Familiarize yourself with the mark-up guidelines set by payers and industry standards. Ensure that your mark-up falls within the acceptable range.
2. Document and justify mark-up: Keep detailed records and documentation to support any mark-up charges. Justify the higher charge with clear explanations and evidence.
3. Disclose mark-up to patients: Clearly communicate the mark-up amount or percentage to patients before providing the service or item. This promotes transparency and avoids surprises or disputes later on.
4. Comply with contractual agreements: If you have any contractual agreements with payers regarding mark-up allowances, ensure that you adhere to them strictly. Violating these agreements can lead to claim denials or adjustments.

5. Example Cases

1. Case 1: A claim is denied due to an excessive mark-up on a medical device. The provider reviews the mark-up, adjusts the billing to a reasonable level, and resubmits the claim for reimbursement.
2. Case 2: A claim is adjusted because the mark-up on a surgical procedure is not justified. The provider provides additional documentation, including detailed surgical notes and medical records, to support the higher charge and successfully resolves the issue.

Source: Remittance Advice Remark Codes