The processing of medical claims often results in denials or payment adjustments, which are communicated between payers and providers using standardized codes. These codes are necessary for efficient revenue cycle management, providing a precise explanation for why the payer did not fully reimburse the requested amount. Understanding these standardized messages is the first step toward correcting errors, ensuring timely payment, and maintaining the financial health of a medical practice. This article defines the denial code PR 27, explains the scenarios that trigger it, and provides steps to resolve this common rejection.
Understanding Claim Adjustment Reason Codes and the PR Prefix
The healthcare industry uses Claim Adjustment Reason Codes (CARCs) to standardize explanations for adjustments made to submitted claims. These codes detail why a claim was paid differently than billed, such as due to a deductible, a contractual rate, or a denial. Every adjustment code consists of a two-letter Group Code and a numerical Reason Code, which together assign financial responsibility for the unpaid balance.
The Group Code establishes the party financially liable for the non-covered amount. The prefix “PR” stands for “Patient Responsibility,” signifying that the patient is financially liable for the remaining balance. This designation is often used for expenses like co-pays, deductibles, and other non-covered services.
The PR prefix notifies the provider that the payer has determined the patient’s plan does not cover the service for the stated reason. A provider must first investigate the numerical reason code to determine if the denial is valid before billing the patient.
The Specific Meaning of Denial Code PR 27
The denial code PR 27 is issued when a payer determines the claim is for “Expenses incurred after coverage terminated.” This means the date of service listed on the claim falls outside the period when the patient was covered under that specific insurance policy. The insurance company is indicating the policy was no longer active when the medical service was rendered.
The PR prefix confirms the financial burden for the entire service transfers to the patient. This is purely an administrative denial based on the patient’s eligibility status on the date of service, unrelated to medical necessity or prior authorization issues.
When a provider receives a PR 27 denial, the date of service is the central point of contention. This situation often arises due to a lapse in continuous coverage, such as switching employers or failing to pay premiums. The denial alerts the provider to confirm the patient’s actual coverage status for that specific date.
Operational Scenarios That Trigger a PR 27 Denial
The most direct cause of a PR 27 denial is when the patient’s coverage genuinely ended before the date of service. For instance, a patient may receive care after leaving a job, unaware that their employer-sponsored policy terminated immediately. The provider’s billing staff may have used outdated insurance information from a previous visit, leading to the denial.
Delayed claim submission is another frequent scenario. If the service date occurred while the patient was covered, but the claim is submitted past the patient’s termination date, the payer’s automated system may incorrectly issue a PR 27 denial. The provider must demonstrate that the actual service date was within the coverage period and that the claim was submitted within the payer’s timely filing limit.
Retroactive termination of coverage is a challenging trigger. In this case, the provider verified eligibility, and the patient was covered on the date of service. However, the payer later cancelled the policy retroactively, perhaps due to non-payment of premiums. The payer applies the termination date backward, nullifying coverage for services already rendered, resulting in the PR 27 denial.
The denial can also result from a simple clerical error during intake or claim preparation. If billing staff accidentally enters an incorrect date of service that is after the policy’s termination date, the claim will be rejected. Submitting the claim to the patient’s previous insurance company instead of their new one also triggers this code. Such administrative mistakes require careful review of the patient’s file against the payer’s records.
Actionable Steps for Resolving PR 27 Denials
The first step in resolving a PR 27 denial is thorough verification of the patient’s eligibility and claim details. The billing team must cross-reference the exact date of service with the policy’s effective and termination dates, contacting the payer directly if needed. This verification confirms the policy status and checks for administrative errors, such as a mistake in the date of service entered on the claim form.
If verification shows the denial was issued in error, the provider should prepare to resubmit or appeal. For resubmission, correct any internal errors, like a wrong date or policy number, and send the claim back for reprocessing. If the denial stems from a payer issue, such as unacknowledged retroactive enrollment, a formal appeal with supporting documentation is required.
The appeal process demands clear evidence. This includes the original eligibility verification record, a copy of the patient’s insurance card, and any communication confirming active coverage on the date of service. The appeal letter must clearly state the facts, reference the supporting documents, and request a review of the PR 27 denial based on the corrected information.
If investigation confirms the service was genuinely rendered after the policy’s termination date, financial responsibility remains with the patient. The provider must then transition to patient billing, ensuring transparent communication about the denial reason and the patient’s obligation. Explain that the PR 27 code indicates a lack of coverage on the date of service and offer payment plan options or financial counseling.