CO-268 Denials Explained: How to Identify, Appeal, and Prevent Them

In the intricate world of healthcare revenue cycle management, denial codes can become significant roadblocks, impacting both cash flow and operational efficiency. Among these, the CO-268 denial code frequently challenges RCM teams, requiring them to divide claims that span two calendar years. Understanding this denial is crucial for revenue cycle teams aiming to streamline processes and reduce revenue leakage. In this article, we will explore what CO-268 denials entail, how to effectively appeal them, and strategies for prevention.

What Is a CO-268 Denial?

The CO-268 denial code is issued when a claim encompasses services provided over two different calendar years. The prefix "CO" stands for Contractual Obligation, indicating that the financial responsibility falls on the provider rather than the patient or payer. This typically requires the provider to resubmit separate claims for each calendar year involved.

Comparison: CO-268 vs Similar Denial Codes

Denial Code	Prefix Meaning	Reason/Description	Who's Financially Responsible
CO-268	Contractual Obligation	The Claim spans two calendar years. Please resubmit one claim per calendar year.	Provider
CO-45	Contractual Obligation	Charges exceed the contracted amount with the payer.	Provider
CO-237	Contractual Obligation	Service included in another payment or bundled payment.	Provider

While CO-268 focuses on the division of claims across calendar years, CO-45 and CO-237 typically deal with payment issues related to contract terms and bundling, respectively.

Common Causes of CO-268 Denials

1. Span Billing: Submitting a single claim for services that extend over two calendar years.
2. Lack of Awareness: Unfamiliarity with payer policies regarding calendar year separation.
3. Documentation Errors: Incorrectly documented dates of service that suggest span billing.
4. System Limitations: Healthcare IT systems not configured to flag or divide such claims automatically.

Impact on Revenue Cycle Teams

CO-268 denials create significant financial and operational challenges for healthcare organizations:

Financial Impact:
- Direct revenue loss from denied claims requiring extensive rework
- Increased accounts receivable days affecting cash flow
- Potential write-offs if appeals are unsuccessful or deadlines missed
- Higher operational costs due to dedicated denial management resources

Operational Impact:
- Staff time diverted from other critical revenue cycle functions
- Need for specialized knowledge of payer policies and clinical documentation
- Coordination between billing, coding, and clinical teams
- Tracking and monitoring of denial patterns and appeal outcomes

To minimize these impacts, healthcare organizations need robust denial management solutions. CombineHealth.ai's AI-powered platform, featuring Adam (AI Denial Manager), helps RCM teams identify, track, and resolve CO-268 denials efficiently, reducing revenue leakage and improving cash flow.

Steps To Appeal a CO-268 Denial

Step 1: Review the Denial Notice
Carefully examine the denial notice to understand the reason for denial and confirm that it pertains to a span billing issue.

Step 2: Gather Documentation
Collect all relevant documentation, including the original claim, dates of service, and any correspondence with the payer.

Step 3: Verify Eligibility
Ensure that the services were indeed provided across two calendar years and check if both are eligible for separate billing.

Step 4: Prepare Appeal Letter
Draft a detailed appeal letter that includes an explanation of the error, accompanied by corrected claims and supporting documents.

Step 5: Submit Within Deadline
Ensure the appeal is submitted before the payer’s deadline to avoid forfeiting the chance for reimbursement.

Step 6: Track and Follow Up
Monitor the status of your appeal and follow up periodically with the payer to ensure resolution.

How To Prevent CO-268 Denials

Front-End Prevention

• Implement training programs for staff on payer-specific billing requirements.
• Use pre-billing audits to catch potential span billing issues before submission.

Billing Best Practices

• Ensure accurate entry of service dates and double-check claims for potential span billing.
• Regularly update billing software to handle claims crossing calendar years.

Technology Solutions

• Employ advanced billing systems that automatically flag claims spanning multiple years.
• Utilize AI tools like Adam for denial management and Rachel for streamlining appeals processes.

CombineHealth.ai's intelligent platform provides automated eligibility verification and real-time claim scrubbing to help prevent CO-268 denials before they occur. Rachel (AI Appeals Manager) streamlines the appeals process when denials do occur, improving success rates and reducing turnaround time.

FAQs

Q1: What does CO-268 mean in medical billing?
CO-268 indicates a denial due to a claim that spans two calendar years, necessitating separate submissions for each year.

Q2: Can CO-268 denials be appealed?
Yes, CO-268 denials can be appealed by submitting corrected claims with appropriate documentation.

Q3: How long do I have to appeal?
The timeframe varies by payer, so it's crucial to check the specific deadline for appeals in the denial notice.

Q4: How can I prevent these denials?
Implement training, billing audits, and advanced technology solutions to catch and correct potential span billing errors before submission. See our complete guide on denial prevention