Denial Reason CO-50: Non-Covered Services Medical Necessity

Denial Code CO 50 – These are non-covered services because this is not deemed medical necessity by the payer

The Insurance Company will deny the claim as CO 50, whenever the procedure code is not compatible with diagnosis code billed based on the LCD/NCD-Local Coverage determination/National Coverage determination guidelines.

LCD: Local coverage determination

NCD: National coverage determination

The denial is based on the Medical necessity i.e. the diagnosis code may be insufficient to support medical necessity as per the NCD / LCD guidelines. According to Section 522 of the Benefits Improvement and Protection Act (BIPA) an LCD is a decision by a fiscal intermediary (FI) or carrier whether to cover a particular service on an intermediary-wide or carrier-wide basis in accordance with Section 1862(a)(1)(A) of the Social Security Act (e.g., a determination as to whether the service or item is reasonable and necessary).

Solution:
The denial CO 50 – These are non-covered services because this is not deemed medical necessity by the payer states that the claim submitted is not appear to be medically necessary to the patient.

• First we need to review whether submitted diagnosis code is payable and billed as per LCD/NCD guidelines.
• If billed diagnosis code is not payable, then we need to resubmit the claim with correct diagnosis code based on LCD/NCD guidelines and resubmit a claim.
• If the diagnosis code submitted based on LCD and it supports the documentation then you have rights to appeal the claim along with supporting documentation.

Insurance company normally covers the services which deemed medically necessary or else claim gets denied as CO 50 – These are non-covered services because this is not deemed a medical necessity by the payer.
Some of the reasons why insurance company denies the claim as CO 50 – These are non-covered services because this is not deemed a medical necessity by the payer, but may not be limited to the following:

• Times where your hospital service exceeds the insurance approved stay length.
• Physical therapy treatment that exceeds Insurance usage limit.
• Suppose Hospital/provider administered treatment that could have been delivered in a cheaper cost setting.
• Prescription of drugs used for cosmetic services.

When you get the above denial it’s better to call the insurance claims department with the following questions for more information in order to resolve the claim.

1. May I know the date when the claim was received(Claim received date)
2. May I know the date when was the claim denied(Claim denial date)
3. Check with insurance representative whether the submitted CPT or Diagnosis code is not medically necessity.
4. If everything needs to be correct as per LCD/NCD guidelines then check appeal limit and address or else request for the fax# if option available to fax the appeal with MR notes.
5. Claim Number.
6. Cal Reference Number.

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