PR-187 Denials Explained: How to Identify, Appeal, and Prevent Them

Denials can be a major roadblock for healthcare revenue cycle teams, and PR-187 is a particularly common and frustrating code. This denial stems from payments tied to consumer spending accounts, such as Flexible Spending Accounts (FSAs), Health Savings Accounts (HSAs), and Health Reimbursement Accounts (HRAs). Left unaddressed, these denials can lead to revenue leakage, operational inefficiencies, and patient dissatisfaction.

In this guide, we’ll break down the PR-187 denial code, including what it means, why it happens, and how to efficiently appeal and prevent these denials. By understanding PR-187, healthcare organizations can protect their bottom line and enhance operational efficiency.

What Is a PR-187 Denial?

The PR-187 denial code occurs when a patient’s consumer spending account, such as an FSA, HSA, or HRA, is used to pay for medical services. The “PR” prefix stands for “Patient Responsibility,” indicating that the financial responsibility lies with the patient, not the provider or payer. This denial often happens when the payer processes the claim but determines that payment should come from the patient’s designated spending account.

Understanding the prefixes is crucial:
- PR (Patient Responsibility): The patient is financially responsible.
- CO (Contractual Obligation): The provider must adjust the charge based on the payer contract.
- OA (Other Adjustment): Miscellaneous adjustments not tied to patient or provider responsibility.

In the case of PR-187, the patient is responsible for ensuring their consumer spending account covers the charges.

Comparison: PR-187 vs Similar Denial Codes

Denial Code	Prefix Meaning	Reason/Description	Who's Financially Responsible
PR-187	Patient Responsibility	Consumer Spending Account payments (FSA, HSA, HRA, etc.)	Patient
PR-2	Patient Responsibility	Coinsurance payment responsibility	Patient
CO-45	Contractual Obligation	Charges exceed the payer’s allowable amount based on the contract	Provider

While PR-187 and PR-2 both place responsibility on the patient, PR-187 specifically refers to payments from consumer spending accounts. CO-45, on the other hand, involves provider adjustments for exceeding contracted rates.

Common Causes of PR-187 Denials

1. Incomplete or Incorrect Patient Account Information: Errors in entering consumer spending account details during registration or billing.
2. Expired or Insufficient Funds in Spending Accounts: The patient’s account may lack adequate funds or have expired.
3. Failure to Verify Eligibility: Skipping eligibility checks for consumer spending accounts prior to claim submission.
4. Coding or Billing Errors: Mistakes in claim submission, such as incorrect CPT or HCPCS codes, can trigger rejections.
5. Patient Misunderstanding of Account Use: Patients may not understand which services their consumer spending accounts cover.

Impact on Revenue Cycle Teams

PR-187 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 are missed.
- Higher operational costs due to the need for dedicated denial management resources.

Operational Impact:
- Staff time diverted from critical RCM functions to resolve denials.
- Need for specialized knowledge of payer policies and patient spending accounts.
- Enhanced coordination required between billing, coding, and clinical teams.
- Increased need to track and analyze denial patterns for process improvement.

To mitigate these challenges, healthcare organizations can leverage robust denial management tools like CombineHealth.ai’s AI-driven platform. With Adam (AI Denial Manager), RCM teams can efficiently identify, track, and resolve PR-187 denials, reducing revenue leakage and improving cash flow.

Steps To Appeal a PR-187 Denial

Step 1: Review the Denial Notice
Carefully analyze the explanation of benefits (EOB) or remittance advice (RA) to confirm the denial reason.

Step 2: Gather Documentation
Collect all necessary documentation, including the original claim, proof of eligibility verification, patient account details, and any communication with the payer.

Step 3: Verify Eligibility
Confirm that the patient had valid coverage and sufficient funds in their consumer spending account at the time of service.

Step 4: Prepare Appeal Letter
Draft a clear and concise appeal letter that outlines the denial details, includes supporting documentation, and requests claim reconsideration.

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

Step 6: Track and Follow Up
Monitor the status of the appeal and follow up with the payer if a resolution is delayed.

How To Prevent PR-187 Denials

Front-End Prevention

• Accurate Patient Registration: Verify and document consumer spending account details during the intake process.
• Eligibility Verification: Use automated tools to check patient coverage and account status in real-time.

Billing Best Practices

• Claim Accuracy: Ensure claims are coded and billed correctly with all necessary modifiers.
• Patient Education: Proactively educate patients about their financial responsibility and consumer spending account use.

Technology Solutions

• AI-Powered Eligibility Tools: Leverage tools like CombineHealth.ai’s eligibility verification to flag potential issues before claim submission.
• Real-Time Claim Scrubbing: Use Adam (AI Denial Manager) to identify and correct errors that could lead to PR-187 denials.

CombineHealth.ai’s intelligent platform automates these processes, reducing denial rates and streamlining revenue cycle operations. When denials do occur, Rachel (AI Appeals Manager) accelerates the appeals process, improving outcomes and minimizing turnaround time.

FAQs

Q1: What does PR-187 mean in medical billing?
PR-187 indicates that payment responsibility lies with the patient’s consumer spending account (e.g., FSA, HSA, HRA).

Q2: Can PR-187 denials be appealed?
Yes, PR-187 denials can be appealed by providing supporting documentation and verifying patient eligibility.

Q3: How long do I have to appeal?
The timeline varies by payer, but appeals should be submitted promptly, often within 30-90 days.

Q4: How can I prevent these denials?
Focus on front-end processes like eligibility verification and accurate billing. See our complete guide on denial prevention.
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