CO-24 denial code
Charges are covered under a capitation agreement or managed care plan
How to fix it
Confirm the patient is genuinely enrolled in the capitated plan. If so, the balance is not separately billable.
How to prevent it
Flag capitated patients in your system so these services are not billed fee-for-service.
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 primary care practice bills an office visit for an established patient and the claim returns CO-24: charges are covered under a capitation agreement.
The patient is assigned to the practice under a capitated contract. The practice is already paid a fixed monthly amount per assigned member, and that payment covers this visit whether or not it happened.
There is nothing to appeal and nothing to bill the patient. What is worth checking is whether the assignment is correct — a patient wrongly attributed to a capitated panel produces a denial for a practice receiving no capitation payment for them.
What sits behind it
Capitation inverts the economics of a visit. Under fee-for-service every encounter generates a claim and a payment. Under capitation the payment arrives monthly per assigned member regardless of utilisation, so a claim for a covered service is a report of activity, not a request for money.
That is why CO-24 is not a denial in any useful sense, and why treating it as one wastes the time of whoever works the queue. The only real question is attribution: is this patient genuinely on our capitated panel for this month, and are we receiving the capitation payment for them.
The failure worth guarding against is the reverse — a patient who left the panel but is still flagged capitated internally, so their billable visits are never submitted fee-for-service. That loses revenue silently, and unlike a denial it produces no remittance line to notice.
Related codes
Terms used here — Contractual Adjustment · Eligibility Verification · Allowed Amount
How we handle it — Eligibility Verification · Practice Analytics · Revenue Cycle Management
Primary sources
The rules behind CO-24, at the bodies that publish them.
- 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.
- Medicare Benefit Policy Manual (opens in a new tab)
Centers for Medicare & Medicaid Services — What Medicare covers and under what conditions, as distinct from how a claim is processed. The starting point for any coverage or medical necessity question.
Looking for a different code? Search all 190 CARC and RARC codes
Questions about CO-24
The service falls under a capitation agreement, so no fee-for-service payment is due. The practice is paid a fixed monthly amount per assigned member that already covers the visit. The claim is a report of activity rather than a request for payment.
No. The CO prefix makes it a contractual obligation, and the capitation payment is the payment. Billing the patient for a service already covered by capitation generally breaches the agreement.
Only where the patient is not genuinely on your capitated panel. That does happen — attribution errors assign patients to the wrong practice. Confirm the assignment and whether you are receiving capitation for that member before adjusting.
The expensive error runs the other way: a patient who has left the panel but is still flagged capitated internally, whose billable visits are never submitted fee-for-service. That produces no denial and no remittance line, so nothing surfaces it.
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