Company Settings: Full Contractual Adjustment Settings

It’s possible for payers to adjudicate a procedure line by writing off the full billed amount as a contractual adjustment. This is effectively a denial, but in many systems it won’t trigger the typical process for handling denials. 

We have added two company settings to help deal with instances of full contractual adjustments, with the following default values:

  • Full Contractual Adjustment Payment Type = [ERA No Payment]
  • Full Contractual Adjustment Claim Status = [Denied]

If your practice receives a procedure line on an ERA that is fully adjusted with a CO-45 (the line charge amount on the ERA is equal to the adjusted amount on the CO-45), the CO-45 CARC code will use these settings for its payment type and claim status instead of the CO-45's usual CARC settings. For instance, with the default settings, this CO-45 will be posted with an ERA No Payment payment type, and it will change the Claim Status to "Denied."

If either of the settings is set to '0', the normal settings for a CO-45 will be used if a full contractual adjustment is received.