What does CARC 96 mean?

CARC 96 is the general non-covered charge denial. It means at least part of the billed service is not covered under the patient's plan. X12 requires a Remittance Advice Remark Code (RARC) to accompany CARC 96 that explains the specific reason for non-coverage.

Can I appeal a CARC 96 denial?

Sometimes. Appeal when the plan document actually covers the service, when the payer applied the wrong policy, when the group code is inconsistent with the RARC, or when the service was pre-authorized as covered. Do not appeal statutory exclusions (RARC N425) or NCD-based denials (RARC N386) through a plan appeal.

Is CARC 96 the same as CARC 204?

No. CARC 96 is the general non-covered charge code. CARC 204 is the plan-specific non-covered code ("not covered under the patient's current benefit plan"). CARC 204 always ties back to a specific plan document; CARC 96 can also reflect statutory exclusions, policy exclusions, or coverage-rule denials.

What group code should CARC 96 have?

It depends on the exclusion type. PR (Patient Responsibility) when the plan does not cover the service but the patient can be billed. CO (Contractual Obligation) when the provider must write it off. OA or PI when the payer is making an internal adjustment. The wrong group code paired with CARC 96 is one of the most common billing errors.

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CARC Code Reference

CARC 96: Non-Covered Charge. What it means, and how to work it.

CARC 96 is the general non-covered charge denial. It almost never appears alone. The paired Remittance Advice Remark Code (RARC) tells you why coverage was denied, the Group Code tells you who owes the balance, and the plan document tells you whether the denial is correct. Reading all three is what separates a legitimate write-off from an appealable payer error.

By Mindy Corbett, CSPO, CPC, CPB, CPPM · 6 min read

CARC 96

RARC M1

This combination tells a more specific story than CARC 96 alone. The CARC identifies the category of denial; RARC M1 points to the specific field, data element, or clinical element driving it. The charges are not covered under the patient's plan. CARC 96 identifies non-coverage but does not, on its own, state the specific exclusion basis.

Common drivers: Plan exclusion or benefit limitation applicable to the billed service; financial-responsibility waiver not obtained before rendering a routinely excluded service; or CPT/HCPCS billed for a non-covered service category.

CARC 96 with RARC M1 - Billed Service Not Covered by Health Plan scenario.

RARC M1, Official Definition

X-ray not taken within the past 12 months or near enough to the start of treatment.

Root Causes

Plan exclusion or benefit limitation applicable to the billed service; financial-responsibility waiver not obtained before rendering a routinely excluded service; or CPT/HCPCS billed for a non-covered service category.

Action Plan

Review the payer's policy and plan exclusion/provisions related to this denial/service
Review documentation to determine if visit meets payer requirements
if visit meets payer requirements for payment, record findings, and reasoning, pull a copy highlighting the section of the payer policy that supports your claim that the visit meets the guidelines listed in the policy, and attach it with your appeal letter and documentation

Appeal Tips

Complete Action items, then determine if an appeal or a corrected claim is required.
If a corrected claim is required:
Submit a corrected claim, making sure that the claim frequency code is updated ("7", in most cases) to prevent being denied as a duplicate, and the payer's original claim number is included
For ALL reworked claims (appealed/corrected/resubmitted):
Your standard workflow process should include a 24 hour follow up to check in with the clearinghouse to validate that all corrected claims show "accepted" and that they have not been rejected as a duplicate
Set a follow up date and track the claim to ensure timely payment

Prevention Strategy

During benefits verification, explicitly confirm whether the specific CPT/HCPCS is covered; general eligibility confirmation is not enough.
For frequently non-covered services, obtain a signed patient financial-responsibility waiver before rendering.
Audit CARC 96 denials quarterly by CPT and payer; for high-denial codes, investigate alternative covered codes or pre-authorization pathways.

✅ Verified 2026-06-16 · Source: ASC X12 · Rendered live from the EDI Code Intelligence Lab data set.

What CARC 96 Actually Means

Claim Adjustment Reason Code (CARC) 96 is the general non-covered charge denial. The payer is telling you that at least part of the service you billed is not covered under the patient's plan. CARC 96 almost never appears alone: X12 requires it to be accompanied by a Remittance Advice Remark Code (RARC) that explains why the service is not covered. The RARC is the part that tells you what to do next.

This is the reason CARC 96 gets misread more often than any other denial. Teams see "non-covered" and immediately write the claim off. But CARC 96 is not a conclusion, it is a category. The specific RARC on the same line, the group code, and the plan document together tell you whether the write-off is correct, whether the patient is responsible, or whether the denial is a payer error you should appeal.

Read the Group Code First

Before you look at anything else on a CARC 96 line, look at the Claim Adjustment Group Code (CAGC) directly to its left:

PR (Patient Responsibility) means the plan does not cover this service and the balance is billable to the patient. Send a statement. Do not appeal, because the plan is not the party you are asking to pay.
CO (Contractual Obligation) means the provider is contractually barred from billing the patient. The service is written off. Appealing is only worth the time if you believe the plan misread the service.
OA (Other Adjustment) or PI (Payer Initiated) means the payer is making an internal adjustment. These often signal a payer error or an alternate benefit pathway. Read the RARC to decide next steps.

The wrong group code paired with CARC 96 is one of the most common billing errors that never gets caught. If you are seeing CO on a service the patient's plan clearly excludes, the patient is being incorrectly written off. If you are seeing PR on a service the payer should have covered, the patient is being incorrectly billed.

The RARC Is the Story

CARC 96 rides with a wide range of RARCs. The most common pairings:

M1 - X-ray not taken within the past 12 months or near enough to the service to be considered timely
N30 - Patient ineligible for this service
N130 - Consult plan benefit documents/guidelines for information about restrictions for this service
N386 - This decision was based on a National Coverage Determination (NCD)
N425 - Statutorily excluded service(s)

Each of those RARCs describes a different problem. N30 is a member-eligibility issue that may be fixed by verifying coverage or updating the primary payer. N130 tells you the answer is inside the plan document and you need to pull it. N386 tells you the payer applied a Medicare NCD and the denial is based on national coverage rules. N425 tells you the service is statutorily excluded from Medicare regardless of medical necessity, and an appeal will not overturn it.

When to Appeal CARC 96

An appeal is worth submitting when you can demonstrate one of the following:

The service is actually covered under the plan. Pull the plan's Summary of Benefits or Evidence of Coverage. If the service is a covered benefit and the payer denied it as non-covered, cite the section of the plan document and request review.
The denial applied the wrong policy. Some payers auto-apply a coverage rule from a different plan or a different line of business. If you can show the rule cited does not apply to this member's plan, that is an appealable error.
The RARC is inconsistent with the group code. A PR denial on a service that is contractually written off, or a CO denial on a service that is patient-responsibility, is a payer error. Point it out.
The service was pre-authorized as covered. If you have a written authorization or a documented eligibility check showing the service was approved as a covered benefit, attach it. Appeal on the grounds that the payer's representation induced you to render the service.

When Not to Appeal

If the RARC is N425 (statutorily excluded) or N386 (NCD-based), an appeal on medical necessity or coverage grounds will not overturn the denial. Statutory exclusions require a legislative change, not a claim resubmission. NCDs can only be challenged through the CMS reconsideration process, which is not a payer appeal. In both cases, the correct next step is to bill the patient (if permitted) or write off the balance.

If the group code is PR and the plan document confirms the exclusion, the patient is responsible. Send a statement, notify the patient of the exclusion, and offer to help them appeal to their plan directly.

How to Prevent CARC 96 Denials

Verify plan-specific coverage during eligibility checks, not just active/inactive status. Most eligibility APIs return covered service categories.
Build a benefit-verification step into intake for high-cost or elective services. Get the coverage decision in writing before the encounter.
Track CARC 96 denials by RARC and CPT code pair. You will find the same combinations recurring, which tells you exactly where to add a pre-submission check.
When the plan document says a service is covered but the payer denies it as non-covered, escalate the pattern. This is a payer configuration error that will keep costing you until you get it corrected at the plan level.

EDI Code Intelligence Lab

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Every denial code includes what it means, why it happens, how to fix it, how to appeal it, and how to prevent it from coming back.

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Related Resources

CARC 96 denials often pair with plan-specific exclusion patterns tracked in the CARC 204 denial brief and the Non-Covered Service Appeal Template.