Read a CARC / RARC

Outcome

You can read a denial's CARC + RARC and translate it into the right action — auto-correct, rebill, appeal, write-off, or educate.

Prerequisites

Scope	What it lets you do
billing.denial.read	View the codes

What CARC and RARC are

CARC (Claim Adjustment Reason Code) is a categorical reason code on the CAS segment of the 835. Examples: CO-4 (modifier), CO-29 (timely filing), PR-1 (deductible).

RARC (Remittance Advice Remark Code) is a narrative explanation on the LQ segment, prefixed M*, MA*, or N*. Examples: M16 (see attached letter), MA13 (unlisted procedure code).

A denial usually carries one CARC and may carry one or more RARCs. The CARC tells you the category; the RARC clarifies specifics.

The reading order

CARC quick reference

The full reference is at 9.3; here's the field-tested cheat-sheet:

CARC	Plain English	First move
CO-1 / 2 / 3	Patient deductible / coinsurance / copay	Auto-routed to patient AR; verify member's deductible.
CO-4	Procedure code inconsistent with modifier	Auto-correct: CO4ModifierHandler.
CO-11	Diagnosis inconsistent with procedure	Manual; usually code-set issue.
CO-15	Authorization missing or invalid	Manual rebill with auth attached, or appeal.
CO-16	Claim/service lacks information	Auto-correct: Co16MissingInfoHandler.
CO-18	Duplicate claim/service	Auto-detect via claim_relationship; check the original.
CO-22	Care may be covered by another payer per COB	COB question; check member's coverage ladder.
CO-29	Time limit for filing has expired	Auto-correct for timely-filing exception, else write off.
CO-45	Charge exceeds fee schedule	Informational; normal contractual write-off.
CO-50	Non-covered services	Manual review — sometimes appealable with documentation.
CO-96	Non-covered charges	Same as CO-50.
CO-97	Bundled services	Auto-correct: re-coding handler.
CO-109	Claim not covered by this payer	Wrong payer; check COB.
CO-167	This (these) diagnosis(es) is (are) not covered	Diagnosis issue; rebuild with corrected dx.
CO-197	Precert / authorization absent	Auto-correct: attach auth + rebill.
PR-1 / 2 / 3	Patient deductible / coinsurance / copay	Patient AR.
OA-23	Impact of prior payer	Informational; COB chain working.
PI-50	Not deemed medically necessary	Often appealable with documentation.

RARC quick reference

The most common RARCs:

RARC	Meaning
M16	Alert: see attached
M51	Missing/incomplete/invalid procedure code
M76	Missing/incomplete/invalid diagnosis or condition
M77	Missing/incomplete/invalid place of service
MA13	Alert: you may be subject to penalties for not informing the patient that they are responsible
MA15	Late claim adjustment
MA67	Correction to a prior claim
N4	Missing/incomplete/invalid prior payer EOB
N122	Add-on code cannot be billed by itself
N640	Exceeds the LCD or MUE

A single CARC CO-16 (lacks information) could mean anything; the RARC tells you which information. Always read the RARC alongside.

Decoding the dollar fields

In the 835's CAS:

CAS*CO*45*40~
   group=CO  reason=45  amount=40

That's a $40 contractual write-off under group CO, reason 45 (fee- schedule diff). The platform decodes this on the line drill-down — you don't usually read the raw — but knowing the shape helps when you call the payer.

Multi-CARC lines

Sometimes a single line carries multiple CASes: e.g. PR-1 (deductible) and CO-45 (contractual). The platform splits each into the right ledger:

CAS	Effect
PR-1*X	Patient AR + $X.
CO-45*Y	Contractual write-off + $Y.
CO-97*Z	Bundled adjustment + $Z; engine considers re-coding.

Read each separately; they don't substitute for each other.

Validation

Check	Expected
Hover on CARC chip shows description	Yes.
Click on CARC chip opens reference excerpt	Yes.
Per-line drill shows every CAS	Yes.
Reference excerpt links into the full reference	Yes.

Troubleshooting

Symptom	Cause	Fix
Tooltip shows "Code not found"	New CARC introduced by ASC X12 since last reference refresh	Tenant admin → code-set reference; refresh.
RARC list missing	Payer doesn't supply LQ segments	Common; treat the CARC alone.
CAS group doesn't match expectation	Payer using legacy mapping	Common with smaller commercial; treat by code, not by group.

Where to next

• 5.3 — Auto-correction console — what the engine does with these codes.
• 9.3 — CARC / RARC reference — the full table.