Denial Code 112 is a common rejection code used by insurance payers to indicate that the service billed is not covered under the patient’s current insurance plan. Understanding this denial and addressing it efficiently is crucial to ensure timely reimbursement. Below is a guide to help you navigate Denial Code 112.

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Understanding Denial Code 112

• Definition: Denial Code 112 signifies that the insurance plan does not include coverage for the specific procedure, service, or treatment billed.
• Common Reasons for Denial:
  • The service is excluded under the patient’s policy.
  • The service requires prior authorization, which was not obtained.
  • Incorrect service coding on the claim form.
  • The patient’s plan has limitations or restrictions on certain treatments.

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Steps to Resolve Denial Code 112

1. Review the Explanation of Benefits (EOB):
   • Carefully analyze the EOB or denial notice to confirm the reason for the rejection.
   • Look for any notes regarding specific exclusions or missing information.
2. Verify Insurance Coverage:
   • Contact the insurance provider to verify the patient’s plan details.
   • Confirm whether the denied service is indeed excluded or if an error occurred.
3. Check for Authorization Requirements:
   • Determine if the service required prior authorization.
   • If missing, request retroactive authorization, if allowed by the payer.
4. Review Coding Accuracy:
   • Ensure the correct CPT, HCPCS, or ICD-10 codes were used on the claim.
   • Double-check for modifiers or additional coding requirements specific to the service.
5. Communicate with the Patient:
   • Inform the patient about the denial and their policy’s limitations.
   • Discuss potential options, such as switching to a policy with better coverage or paying out-of-pocket.
6. File an Appeal:
   • If you believe the denial was incorrect, submit an appeal with supporting documentation.
   • Include medical records, coverage proof, and a detailed explanation.
7. Resubmit the Corrected Claim:
   • If an error in coding or authorization caused the denial, correct it and resubmit the claim promptly.

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Tips for Avoiding Future Denials

• Always verify insurance coverage and eligibility before providing services.
• Obtain prior authorizations for procedures prone to denials.
• Stay updated on payer policies and documentation requirements.
• Conduct regular staff training on accurate coding and billing practices.

By following these steps, you can effectively address Denial Code 112 and minimize its recurrence, ensuring smoother claim processing and better revenue cycle management.