PR-27 Denials Explained: How to Identify, Appeal, and Prevent Them

Denial codes are a common obstacle for healthcare revenue cycle management (RCM) teams, and PR-27 is no exception. This code signifies a claim rejection due to expenses incurred after a patient’s coverage terminated, creating significant financial and operational challenges for organizations. Understanding PR-27 denials is key to addressing them effectively and preventing revenue leakage.

In this guide, we’ll explain what PR-27 means, how it compares to similar codes, and how RCM teams can appeal and prevent these denials. By implementing strategic solutions, organizations can minimize the impact of PR-27 and optimize their revenue cycle.

What Is a PR-27 Denial?

The PR-27 denial code stands for “expenses incurred after coverage terminated,” meaning the patient was no longer covered under their insurance plan on the date of service. The "PR" prefix indicates Patient Responsibility, which shifts the financial burden primarily to the patient, though providers may also face payment challenges.

Other denial prefixes include "CO" (Contractual Obligation), indicating payer responsibility, and "OA" (Other Adjustment), which relates to adjustments unrelated to patient or payer obligations. Understanding these distinctions helps identify who is financially responsible for denied claims.

Comparison: PR-27 vs Similar Denial Codes

Denial CodePrefix MeaningReason/DescriptionWho's Financially ResponsiblePR-27Patient ResponsibilityExpenses incurred after coverage terminatedPatientCO-22Contractual ObligationCovered service exceeded plan limitsPayerOA-109Other AdjustmentClaim not covered due to payer policyProvider

Key differences between PR-27 and similar codes lie in the financial responsibility and reasons for denial. While PR-27 pertains to terminated coverage, CO-22 relates to service limits within active coverage, and OA-109 results from payer-specific exclusions. Identifying these nuances helps develop targeted strategies for resolution.

Common Causes of PR-27 Denials

Impact on Revenue Cycle Teams

PR-27 denials pose serious challenges for healthcare organizations, affecting both financial and operational performance.

- Loss of revenue from denied claims that require costly rework.

- Longer accounts receivable days, reducing cash flow.

- Increased risk of write-offs if appeals fail or deadlines are missed.

- Higher costs due to dedicated denial management resources.

- Diverted staff time from other revenue cycle priorities.

- Need for detailed knowledge of payer policies and clinical documentation.

- Coordination among billing, coding, and clinical teams to address denials.

- Ongoing tracking and analysis of denial trends to prevent recurrence.

To mitigate these impacts, organizations need robust denial management solutions. CombineHealth.ai’s Adam (AI Denial Manager) empowers RCM teams to efficiently identify, track, and resolve PR-27 denials, minimizing revenue leakage and improving cash flow.

Steps To Appeal a PR-27 Denial

Carefully evaluate the explanation of benefits (EOB) or denial letter to confirm the reason for rejection.

Collect all necessary documentation, including proof of coverage termination dates, eligibility verification records, and clinical notes.

Double-check the patient’s eligibility status for the date of service by contacting the payer and confirming coverage details.

Draft a clear, concise appeal letter that outlines the reason for the denial, supporting documentation, and a request for reconsideration.

Ensure the appeal is submitted before the payer’s deadline, which is typically stated in the denial notice.

Monitor the status of the appeal and follow up with the payer if necessary to ensure timely resolution.

How To Prevent PR-27 Denials

Front-End Prevention

Billing Best Practices

Technology Solutions

CombineHealth.ai’s Adam provides automated eligibility verification and claim scrubbing, reducing the likelihood of PR-27 denials. If denials occur, Rachel (AI Appeals Manager) streamlines the appeals process, improving success rates and reducing turnaround time.

FAQs

PR-27 indicates expenses incurred after a patient’s insurance coverage terminated, making the patient financially responsible.

Yes, PR-27 denials can be appealed with proper documentation and adherence to payer guidelines.

The timeline varies by payer but is typically outlined in the denial notice. Appeals should be submitted promptly to avoid missed deadlines.

Prevent PR-27 denials by implementing real-time eligibility verification, accurate documentation, and automated claim scrubbing.