CO-23 denial code
The impact of prior payer adjudication
How to fix it
Verify the secondary payer applied the primary's payment correctly. If the math is right, no action is needed.
How to prevent it
Submit complete primary EOB data with secondary claims so adjudication is accurate first time.
The CO prefix marks this a contractual obligation. The balance is absorbed by the provider under the payer agreement and cannot be transferred to the patient.
In practice
A secondary claim is submitted after Medicare paid as primary. The remittance from the secondary payer shows CO-23 against part of the balance.
This is the secondary payer accounting for what the primary already did. It is not refusing to pay; it is showing its working, reducing the amount it considers by what has already been paid or adjusted upstream.
The action is arithmetic, not appeal. Confirm the secondary applied the primary's payment and adjustments correctly. Where the maths is right, the line closes with no further work.
What sits behind it
CO-23 appears almost exclusively on secondary and tertiary claims, and it is one of the codes most often miscategorised as a denial. A queue full of CO-23 lines usually means coordination-of-benefits remittances are being routed to denial management rather than payment posting.
The situation that does need attention is a secondary payer that has misread the primary's explanation of benefits — commonly by treating a contractual adjustment as a payment, which understates the remaining balance. That is a genuine underpayment wearing the clothes of a routine adjustment.
Prevention is upstream and mechanical: submit complete primary EOB data with the secondary claim. Incomplete crossover data is the single largest cause of secondary claims being adjudicated on assumptions rather than on what the primary actually did.
Related codes
Terms used here — Coordination of Benefits · Contractual Adjustment · Allowed Amount
How we handle it — Claims Management · Practice Analytics · AR Management
Primary sources
The rules behind CO-23, at the bodies that publish them.
- Medicare Secondary Payer Manual (opens in a new tab)
Centers for Medicare & Medicaid Services — When Medicare pays second, and to whom the claim goes first. Coordination-of-benefits denials are resolved here rather than with the patient.
- Medicare Claims Processing Manual (opens in a new tab)
Centers for Medicare & Medicaid Services — The operative manual for how Medicare claims must be coded, submitted, adjusted and appealed. When a payer policy and a vendor's advice disagree, this settles it.
- Claim Adjustment Reason Codes (CARC) (opens in a new tab)
X12 — The authoritative, maintained CARC list. Our denial code lookup explains these in plain English; X12 is where the canonical definitions live.
Looking for a different code? Search all 190 CARC and RARC codes
Questions about CO-23
Generally not. It is the secondary payer accounting for what the primary already paid or adjusted, which is a normal part of coordination of benefits. It appears on secondary and tertiary claims and usually requires no action beyond confirming the arithmetic.
When the secondary payer has misread the primary's explanation of benefits — most often by treating a contractual adjustment as a payment, which understates what remains. That is an underpayment presented as a routine adjustment.
No. The CO prefix marks it a contractual obligation absorbed by the provider. Patient responsibility on a secondary claim arrives under PR codes, not this one.
Submit complete primary EOB data with every secondary claim. Incomplete crossover data is the main reason a secondary payer adjudicates on assumptions rather than on what the primary actually did.
Find out what your denials are costing you
A free billing audit reviews your denial rate, AR aging and clean claim rate against industry benchmarks. Takes about two minutes to request. No sales pitch.
No setup fees · You pay when we collect · Pricing from 3% of net collections