CO-197 denial code: meaning, causes and fixes

This guide explains denial code CO-197: the official definition, what usually causes it, how to fix it and how to prevent it. It's part of our denial management guide and the denial code guides series.

Official definition (X12 CARC 197)

Claim adjustment reason codes (CARCs) are maintained by X12 and describe "why a claim or service line was paid differently than it was billed." CARC 197 reads:

"Precertification/authorization/notification/pre-treatment absent."

Source: X12 Claim Adjustment Reason Codes, checked October 18, 2026.

What the "CO" prefix means

The letters before the number are a claim adjustment group code. X12 says group codes "generally assign responsibility for the adjustment amounts" and defines them as CO (Contractual Obligation), PR (Patient Responsibility), OA (Other Adjustment) and PI (Payer Initiated Reductions) (X12). With CO, the adjustment is generally treated as the provider's responsibility under its payer contract rather than the patient's, so check your contract before billing the patient for a CO amount. The same reason code can appear with a different group code (for example PR or OA), which changes who is responsible.

Common causes

• No authorization was requested before the service
• An authorization exists but the number wasn't on the claim
• The authorization was for a different provider, location, date range or service
• Authorized units or visits were exceeded (X12 uses CARC 198 for 'exceeded')
• The authorization expired (CARC 302 covers an expired time limit)

How to fix it

1. Search your records and the payer portal for an existing authorization.
2. If found, correct the claim with the authorization number and resubmit.
3. If the authorization covers a different provider or service, check CARCs 284 and 296, which X12 uses when an authorization number may be valid but doesn't apply.
4. If none exists, ask the payer about retro-authorization or appeal, with documentation of medical necessity and urgency.
5. Feed the miss back to the PA owner.

How to prevent it

• Maintain a prior authorization matrix by payer and service
• Make authorization part of scheduling, not an afterthought
• Track units, visits and expirations (see prior authorization specialist and outsourcing)
• Make sure authorization numbers flow onto claims automatically

Who should work these denials

Denials need an owner with payer knowledge and time to follow up before deadlines. See denial management and what an AR specialist does. If your team doesn't have the capacity, you can request help; requests may be referred to Alliance Global Solutions, which operates this site and is currently our only approved vendor. For A/R follow-up and denial rework capacity, see its remote accounting staff page.

This guide is general information, not coding or legal advice. Payer rules vary; check the payer's policy and the remark codes on your remittance.