Claim denials are increasing rapidly. In 2025, the national initial claim denial rate rose to 11.8%, up from 10.2% just a few years before. Much of the increase is due to stricter requirements and more denials under Medicare Advantage plans, which are expected to rise by 4.8% between 2025 and 2026. For providers and billing teams dealing with the CO 24 Denial Code, these figures imply more denied claims, lost revenue, and administrative issues.
CO 24 usually indicates that services are already covered by a capitation or managed care plan. While capitation provides set payments to eligible patients, it limits billing stress. Incorrect answers result in denials, manual corrections, and financial losses.
This page explains what the CO 24 Denial Code means, why it occurs, and how to resolve it. You’ll get clear instructions on common causes, preventive measures, and correction methods. The goal is for healthcare professionals, billing staff, and administrators to handle denials quickly and maintain revenue.
What is the CO 24 Denial Code?
This section describes what the CO 24 Denial Code is and why it is issued. You will receive precise, expert-backed definitions and reasoning.
CO 24 Denial Code Description
The CO 24 Denial Code indicates that a claim was denied because the services fall under a capitation agreement or managed care plan.
Under such contracts, providers are paid a set amount per patient that covers a wide range of services. Billing separately results in denial.
Medicare contractors, such as Noridian, cite CO-24 when the claim should be sent to the patient’s Medicare Advantage plan rather than Original Medicare.
CO 24 Denial Code Reason
Common causes include:
- Wrong payer billed: Claim was directed to Original Medicare rather than Medicare Advantage or another capitated plan.
- Capitation contracts involve service, which is already included in the fixed monthly cost.
- Eligibility data is outdated: Insurance systems mistakenly report managed care status upon submission.
- Documentation gap: There is no confirmation that the service falls outside the capitated benefits.
Denial Code CO 24 in Medical Billing
The CO 24 Denial Code indicates that the expenses are covered under a capitation agreement or managed care plan. This denial is prevalent in 2025, particularly among suppliers working under capitated contracts. Understanding the impact and resolving frequent problems is critical for providers and billing teams.
Impact on Providers and Billing Teams
According to industry predictions, capitation-based denials are expected to account for 7–11% of total claim rejections in outpatient and primary care clinics by 2025. For larger systems, they constitute one of the top five denial scenarios.
The CO 24 Denial Code causes revenue delays while increasing administrative workload. Billing staff frequently spend hours resubmitting claims or disputing contractually ineligible payments. Providers face compliance risks if claims are billed outside of capitation agreements.
Key challenges include:
- Reduced reimbursement for claims that were already covered in per-member-per-month (PMPM) payments.
- Additional administrative expenditures for claim reprocessing.
- When statements indicate that services were withheld, patients become more confused.
Common Errors Leading to CO 24 Denials
The majority of CO 24 denials are the result of easily avoidable billing workflow errors. According to payer audit statistics of 2025, the top five reasons for CO 24 claim denials are as follows:
1. Incorrect claim submission: Billing for treatments that are already covered by the patient’s capitation agreement.
2. Failures in eligibility verification include failing to validate the capitation plan enrollment before giving services.
3. Coding problems include using CPT codes that come under global capitation payments.
4. Lack of updated contracts: Providers bill services without complying with the most recent payer capitation terms.
5. Duplicate claims: Submitting separate claims for services included in the PMPM agreement.
How to Fix the CO 24 Denial Code
The CO 24 Denial Code has the potential to cause payment delays and increased administrative costs. This section provides specific actions for correcting these denials and preventing them from repeating.
Steps to Correct CO 24 Denials
Correcting CO 24 denials requires detailed verification and claim revisions. Following these steps:
- Verify patient enrollment: Ensure that the patient is a member of a capitation or managed care plan. Use eligibility tools or contact the payer directly.
- Analyze the denied claim: Verify for coding flaws, duplicate submissions, or missing documentation that caused the denial.
- Correct coding and billing details: Ensure that CPT/HCPCS codes correspond to the payer’s capitation terms. Include appropriate modifiers, if applicable.
- Attach supporting documents, including thorough clinical notes, service justification, and prior authorization records as needed.
- Resubmit the claim promptly: Submit revised claims as soon as possible to avoid income delays. Track the claim to ensure its acceptance.
- Follow up with payers: Maintain a direct connection with the insurance company to resolve any outstanding issues or provide clarity on security.
Conclusion
The CO 24 Denial Code shows that services are covered by capitation or managed care programs, which impacts revenue and administrative efficiency. Understanding this code enables providers and billing teams to spot potential concerns before claims are submitted.
Providers may reduce these denials by validating patient enrollment, updating contracts, and ensuring proper coding and documentation. Errors should be corrected as soon as possible, and supporting documentation should be attached for verification.
Implementing these tactics increases compliance, reduces repetitive denials, and assures better revenue cycles. Keeping up with capitation standards helps to ensure constant reimbursement and prevents financial interruptions.
FAQs
What does the CO 24 Denial Code mean?
The CO 24 Denial Code indicates that the billed services are already covered under a capitation or managed care plan, preventing additional reimbursement.
Why do claims get denied under CO 24?
Common reasons include incorrect payer billed, outdated eligibility data, documentation gaps, coding errors, or services already covered in the capitation agreement.
How does CO 24 impact providers and billing teams?
It causes delayed payments, increased administrative workload, compliance risks, and extra hours spent on claim corrections or disputes.
How can I fix a CO 24 denial?
Verify patient enrollment, correct coding, attach required documentation, resubmit the claim promptly, and follow up with the payer’s resolution.
How can future CO 24 denials be prevented?
Keep up-to-date contracts, confirm patient eligibility before service, use accurate coding, keep complete paperwork, and review capitation requirements regularly.
