What Is CARC 27?
CARC 27 indicates a denial because the patient's coverage with the payer had terminated before the date of service, meaning the patient was not insured by this payer on the day services were rendered.
- Run real-time eligibility checks at every check-in, not just at scheduling.
- Patients enrolled through ACA Marketplaces, COBRA, Medicaid, and Medicare Advantage are most likely to have mid-year coverage changes that show up as CARC 27.
- A robust front-end eligibility process eliminates 70-80% of CARC 27 denials.
CARC 27
Also known as: Denial Code 27; Expenses incurred after coverage terminated
CARC 27 indicates a denial because the patient's coverage with the payer had terminated before the date of service, meaning the patient was not insured by this payer on the day services were rendered.
Definition
CARC 27 is the standard X12 code for terminated-coverage denials. Common causes: employer plan changed at year-end, member missed COBRA premium, Medicaid recertification lapse, member switched payers mid-year, or Medicare Advantage enrollment change. The first response is to re-verify eligibility on the actual date of service (not the date of inquiry); if the patient had coverage with a different payer, rebill that payer with the correct member info. If genuinely uninsured on the date of service, the balance becomes patient responsibility, often with self-pay discount eligibility.
Example
A claim for a January 5 visit denies CARC 27 from BlueCross. Eligibility re-verification with the same member ID for January 5 confirms termination effective December 31. The patient enrolled in UnitedHealthcare effective January 1. Rebill UHC with correct member info; the BCBS denial is final.
Common Misconceptions
CARC 27 denials are not always uninsured patients — most are coverage-changed patients with active insurance under a different plan. The lookup-and-rebill workflow recovers most CARC 27 denials within 30-60 days.
Practical Application
Run real-time eligibility checks at every check-in, not just at scheduling. Patients enrolled through ACA Marketplaces, COBRA, Medicaid, and Medicare Advantage are most likely to have mid-year coverage changes that show up as CARC 27. A robust front-end eligibility process eliminates 70-80% of CARC 27 denials.
Related Terms
CARC
A Claim Adjustment Reason Code is a standardized code maintained by the X12 External Code List committee that explains why a claim line was adjusted (paid less than billed, denied, or transferred to patient responsibility) on a payer's 835 ERA.
Read definition arrow_forwardEligibility Verification
Eligibility verification is the process of confirming a patient's insurance coverage is active for the date of service, determining the plan benefits (deductible, copay, coinsurance, covered services), and identifying any prior-auth or referral requirements before the encounter.
Read definition arrow_forwardCARC 50
CARC 50 indicates the payer denied a claim because it determined the services were not medically necessary based on its medical-necessity policy, LCD, NCD, or commercial medical-policy criteria.
Read definition arrow_forwardWhere This Applies on MedPrecision
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