Notes on payer behavior

CO-96 denial code: non-covered charge, and the remark code that explains why

Clearia · Updated October 26, 2026 · denial codes, read properly

Denial code CO-96 is the payer saying: "Non-covered charge(s)." In short: A category, and the remark code says why. Bundling, setting, frequency and modifier cases are recoverable; true plan exclusions aren't.

What the payer is asserting

CO-96 is a category, not a reason. The payer is saying this charge isn't payable under the plan, and it's required to attach a remark code that says why. Without the remark code you can't work it. With it, CO-96 splits into a few very different denials, some of which are wrong.

The five reasons behind a CO-96

• Plan exclusion. The service is excluded under the patient's benefit plan. Cosmetic, experimental, a category the employer's plan doesn't buy. Remark codes in the N-range name the exclusion. Usually correct, usually patient responsibility if the contract allows it.
• Bundled by policy. The payer considers the charge part of another service. This is the CO-96 that overlaps with CO-97 and is worth checking against your contract, because payers apply bundling rules their contracts don't support.
• Non-covered by this provider type or setting. The service is covered, but not when billed by this provider or in this place of service. Sometimes a credentialing problem. Sometimes a claim that went out with the wrong POS code.
• Frequency or benefit limit. The plan covers a set number per year and this one is past it. Often correct. Sometimes the payer's count includes another provider's services or a prior year's.
• Missing a required modifier or code. A GY on Medicare, an S-code the commercial payer wanted instead of the CPT, a screening versus diagnostic distinction the claim didn't make. The care is covered; the claim didn't say so.

Which ones reverse

The last three regularly. Bundling that the contract doesn't allow is a reconsideration with the contract page. A provider-type or setting denial that stems from a claim error is a corrected claim. A frequency limit that counts wrong is a reconsideration with the service history. A missing modifier is a corrected claim. Only the first, the true plan exclusion, is generally final, and even then the question of who pays remains.

Who pays a true exclusion

The group code decides. CO-96 assigns the amount to you. PR-96 assigns it to the patient. Payers sometimes send CO-96 where the contract says the patient is responsible for excluded services, and that's a reconsideration to have the group code corrected so the patient can lawfully be billed. On Medicare, the patient can be billed for a statutorily excluded service without an ABN, but for a service that's usually covered and denied in this instance, only with one. The full group-code logic.

The pattern to watch

A CO-96 count that climbs from one payer without a plan change means a policy changed on their side. Payers publish policy updates; practices rarely read them. Find the policy behind the remark code, check the effective date against your contract, and if the contract doesn't allow it, dispute the set.

Source: the code descriptions on this page are quoted from the X12 Claim Adjustment Reason Code list, the standard code set every payer remittance uses.