OA-137 Denials Explained: How to Identify, Appeal, and Prevent Them

In the complex world of healthcare revenue cycle management (RCM), denial codes like OA-137 can present significant challenges. This particular denial code—associated with regulatory surcharges, assessments, and health-related taxes—can lead to revenue loss and operational inefficiencies if not managed effectively. Understanding OA-137 denials is critical for RCM teams to maintain financial stability and operational efficiency.

In this article, we’ll explain what OA-137 means, how to identify and appeal these denials, and, most importantly, how to prevent them from disrupting your revenue cycle operations.

What Is a OA-137 Denial?

The OA-137 denial code refers to a payment adjustment related to regulatory surcharges, assessments, allowances, or health-related taxes. The prefix “OA” stands for “Other Adjustment,” indicating that the denial does not fall under patient responsibility (PR) or contractual obligation (CO). Instead, it reflects external adjustments applied by payers.

With OA-137 denials, the financial responsibility typically falls on the provider rather than the patient. These adjustments are made by payers to comply with regulatory requirements, and as such, they require careful management to minimize their impact on revenue.

Comparison: OA-137 vs Similar Denial Codes

Denial Code	Prefix Meaning	Reason/Description	Who's Financially Responsible
OA-137	Other Adjustment	Regulatory Surcharges, Assessments, or Taxes	Provider
CO-45	Contractual Obligation	Charges exceed payer’s contracted allowable amount	Provider
PR-96	Patient Responsibility	Patient's portion of non-covered services	Patient

While OA-137 is related to regulatory adjustments, CO-45 and PR-96 focus on contractual and patient responsibility adjustments, respectively. The key difference lies in the reason for adjustment and the party responsible for covering the denied amount.

Common Causes of OA-137 Denials

1. Misinterpretation of Payer Policies: Providers may overlook or misinterpret regulatory requirements tied to payer contracts, leading to denials.
2. Incomplete Billing Information: Missing or incorrect billing details related to regulatory surcharges or taxes can trigger OA-137 adjustments.
3. Lack of Documentation: Insufficient documentation supporting the regulatory charges can result in denials.
4. Unverified Eligibility: Failure to verify the payer's eligibility criteria for surcharges or assessments may lead to payment adjustments.
5. Late Submission of Claims: Delayed claims submission can lead to denials, particularly when specific regulatory deadlines are missed.

Impact on Revenue Cycle Teams

OA-137 denials can have a ripple effect on healthcare organizations, both financially and operationally.

Financial Impact:

• Revenue loss from claims requiring manual rework or write-offs
• Prolonged accounts receivable cycles, straining cash flow
• Increased denial-related operational costs, diverting resources from other priorities
• Risk of non-compliance penalties if adjustments are mishandled

Operational Impact:

• Added workload for billing and denial management staff
• Increased coordination demands between teams (e.g., billing, coding, and clinical)
• Need for specialized knowledge to resolve complex regulatory adjustments
• Difficulty in monitoring and analyzing denial trends without advanced tools

These impacts highlight the importance of proactive denial management strategies. CombineHealth.ai’s AI-powered solutions, including Adam (AI Denial Manager), empower RCM teams to efficiently identify, track, and resolve OA-137 denials, reducing financial drain and operational strain.

Steps To Appeal a OA-137 Denial

Appealing OA-137 denials requires a systematic approach to ensure success:

Step 1: Review the Denial Notice
Examine the Explanation of Benefits (EOB) or Electronic Remittance Advice (ERA) to confirm the denial code and reason.

Step 2: Gather Documentation
Collect all relevant documentation, including claim forms, billing records, and supporting evidence for the regulatory charges or assessments.

Step 3: Verify Eligibility
Confirm that the claim aligns with payer policies and regulatory requirements. Check for any overlooked conditions or criteria.

Step 4: Prepare Appeal Letter
Draft a formal appeal letter that includes the denial code, a detailed explanation of the charges, and supporting documentation.

Step 5: Submit Within Deadline
Ensure the appeal is submitted within the payer’s specified timeframe to avoid automatic rejection.

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

How To Prevent OA-137 Denials

Preventing OA-137 denials requires a multi-faceted approach, combining front-end processes, billing best practices, and technology-driven solutions.

Front-End Prevention

• Ensure Eligibility Verification: Confirm regulatory requirements during patient registration and eligibility checks.
• Educate Staff on Payer Rules: Train billing and coding teams on payer-specific surcharges and assessments.

Billing Best Practices

• Accuracy in Claims Submission: Double-check claims for completeness and alignment with payer guidelines.
• Timely Filing: Submit claims promptly to meet regulatory deadlines and avoid unnecessary adjustments.

Technology Solutions

• Automated Claim Scrubbing: Use AI-driven tools like CombineHealth.ai’s Adam to identify potential issues before submission.
• Denial Pattern Analysis: Leverage analytics to track and address recurring OA-137 denials.

CombineHealth.ai’s intelligent platform also features Rachel (AI Appeals Manager), which simplifies the appeals process, enabling RCM teams to address OA-137 denials efficiently while freeing up resources for other critical tasks.

FAQs

Q1: What does OA-137 mean in medical billing?
OA-137 refers to a denial code for payment adjustments tied to regulatory surcharges, assessments, allowances, or health-related taxes.

Q2: Can OA-137 denials be appealed?
Yes, OA-137 denials can be appealed by gathering proper documentation and submitting a formal appeal to the payer.

Q3: How long do I have to appeal?
The appeal deadline varies by payer, so it’s essential to review the denial notice and adhere to the specified timeframe.

Q4: How can I prevent these denials?
Implement robust front-end checks, accurate billing practices, and technology solutions like CombineHealth.ai’s AI-powered tools. See our complete guide on denial prevention.