charges exceed your contracted/legislated fee arrangement - Medicare adjustment

This adjustment code mean that provider billed the service with more than allowed amount and provider not eligible to bill more than what is allowed in the claim.

These adjustments change the fee schedule amount and the corresponding limiting charge for
the services involved. Therefore, for the application of limiting charge calculations, it is incorrect
to interpret the term "fee schedule amount" to mean a fixed amount.

To calculate the limiting charge, locate the dollar amount shown in the Allowed Amount column
on the SPR and multiply it by 115%. The result is the correct limiting charge for that detail.
Subtract the limiting charge amount from your billed amount of the service to determine the
overcharge to be refunded to the patient. For a single line claim, this amount will match the
amount show on the line identified by ANSI message CO45 "Charges exceed your
contracted/legislated fee arrangement." For a multiple line claim, the CO45 message appears
only once with a total of overcharges. Any line item with a zero allowed amount identified with
CO45 is also a limiting charge excess and must be refunded to the patient.

Examples:
1. Billed amount = $92.00
Approved amount of $75.00 x 115% = $86.25 limiting charge
The patient's responsibility is shown on the SPR as $86.25. The provider has exceeded the
limiting charge by $5.75.

2. Billed amount = $115.00
Approved amount of $50.00 = $ 57.50 limiting charge
(reduced by 50% due to multiple surgery
guidelines) x 115%
The patient's responsibility is shown on the SPR as $57.50. The provider has exceeded the
limiting charge by $57.50.

3. Billed amount = $80.00
Approved amount = $0 = $ 0.00 limiting charge
(not separately payable) x 115%
The patient's responsibility is shown on the SPR as $0. The provider has exceeded the
limiting charge by $80.00.

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