EDI Code Intelligence Lab · Denial Intelligence Brief: CARC 50, Medical Necessity
CARC 50: not medically necessary. What it means, and how to appeal it.
CARC 50 is one of the most winnable denials on appeal. In June 2026, the HHS Office of Inspector General reported that the three largest Medicare Advantage organizations denied long-term acute care admissions at rates between 71 and 80 percent. When those denials were appealed, 36 percent of long-term care hospital (LTCH) denials were overturned, along with 43 percent of inpatient rehab facility (IRF) denials and 95 percent of skilled nursing facility (SNF) denials. Those numbers come from one corner of healthcare, but the lesson applies everywhere: the initial denial is often the payer's opening position, not the final answer. When you understand what the code is really telling you, you can build the appeal that flips it.
Last verified July 10, 2026 against the current ASC X12 CARC/RARC master lists. Sources: ASC X12, CAQH CORE, HHS OIG report OEI-09-24-00330 and OEI-09-24-00331.
From the EDI Code Intelligence Lab
CARC 50
CLAIM ADJUSTMENT REASON CODE
These are non-covered services because this is not deemed a 'medical necessity' by the payer. Usage: Refer to the 835 Healthcare Policy Identification Segment (loop 2110 Service Payment Information REF), if present.
What This Means
The payer determined the service was not medically necessary based on the information submitted. This typically reflects documentation that did not meet coverage criteria rather than inappropriate care.
Common drivers: Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
Common drivers: Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
Root Causes
- Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
Action Plan
- Obtain the applicable LCD or NCD; compare documented indications against coverage criteria.
- Retrieve the treating provider's progress notes, orders, and diagnostic results supporting medical necessity.
- If documentation gaps exist, route to the treating provider for an addendum addressing specific LCD/NCD criteria before resubmitting.
- If upheld, post the adjustment; balance-bill the patient only if a signed Advance Beneficiary Notice (ABN) was obtained before service.
Appeal Tips
- Draft a first-level appeal citing the specific LCD/NCD article number and criteria met, cross-referencing provider documentation paragraph by paragraph.
- Attach the treating provider's signed letter of medical necessity and relevant records.
- If the payer used an internal medical director, request the reviewer's credentials and demand a physician-to-physician review.
- If upheld, escalate to second-level or external independent review citing coverage criteria and peer-reviewed guidelines.
Prevention Strategy
- Map every high-volume procedure code to its LCD/NCD and build a pre-submission checklist listing each required coverage criterion.
- Implement a prior authorization (PA) workflow for all PA-required procedures and attach the auth number to the claim.
- Train clinical staff to document the specific indication, failed conservative treatments, and decision rationale using language that mirrors LCD/NCD criteria.
The RARC on the remittance tells you which policy you are appealing against.
CARC 50 alone tells you the payer said no. The RARC tells you what they said no to. The three you will see most often on medical necessity denials are below.
CARC 50 + RARC N115. LCD scenario.
CARC 50
+
RARC N115
=
The combination of CARC 50 and RARC N115 tells you more than CARC 50 alone. This combination means based on Local Coverage Determination (LCD) medical necessity was not met
CARC 50 with RARC N115 - Billed Service Not Covered by Health Plan scenario.
RARC N115, Official Definition
This decision was based on a Local Coverage Determination (LCD). An LCD provides a guide to assist in determining whether a particular item or service is covered. A copy of this policy is available at www.cms.gov/mcd, or if you do not have web access, you may contact the contractor to request a copy of the LCD.
Root Causes
- Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
Action Plan
- FInd the LCD for your service and region
- Compare the LCD coverage criteria (allowed ICD-10 list, frequency limits, documentation requirements) against the claim and the medical record
- If the claim met the LCD criteria but the diagnosis code did not crosswalk: rebill with a covered ICD-10 code supported by the documentation
- If you feel that the claim met the criteria, gather documentation to support an appeal.
- If the claim did not meet the LCD criteria: contractual adjustment will likely need to be posted
Appeal Tips
- Gather all supporting documentation, and evidence that the service meets the LCD's criteria.
- Include all dates, diagnosis, and procedure details
- Reference the LCD Number and section that supports your position
- Include the chart note, the diagnosis crosswalk, and an LCD policy excerpt that shows coverage in your appeal.
- Include medical records showing the service was necessary for the patient's condition, and any correspondence with the MAC or patient about the service.
- Match LCD Language EXACTLY
- Track the appeal via the MACs online portal
- Escalate if necessary, following the standard process (MACs OIG or the state appeals board)
Prevention Strategy
- Map every high-volume procedure code to its LCD/NCD and build a pre-submission checklist listing each required coverage criterion.
- Implement a prior authorization (PA) workflow for all PA-required procedures and attach the auth number to the claim.
- Train clinical staff to document the specific indication, failed conservative treatments, and decision rationale using language that mirrors LCD/NCD criteria.
CARC 50 + RARC N386. NCD scenario.
CARC 50
+
RARC N386
=
This combination tells a more specific story than CARC 50 alone. The CARC identifies the category of denial; RARC N386 points to the specific field, data element, or clinical element driving it. The payer determined the service was not medically necessary based on the information submitted. This typically reflects documentation that did not meet coverage criteria rather than inappropriate care.
Common drivers: Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
Common drivers: Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
CARC 50 with RARC N386 - Billed Service Not Covered by Health Plan scenario.
RARC N386, Official Definition
This decision was based on a National Coverage Determination (NCD). An NCD provides a coverage determination as to whether a particular item or service is covered. Visit CMS.gov and search for Medicare Coverage Database to find a copy of the policy.
Root Causes
- Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
Action Plan
- Identify the specific National Coverage Determination (NCD) that applies to the billed service.
- RARC N386 on your remittance indicates: This decision was based on a National Coverage Determination (NCD). An NCD provides a coverage determination as to whether a particular item or service is covered. Visit CMS.gov and search for Medicare Coverage Database to find a copy of the policy. Review the NCD criteria at cms.gov to confirm whether the patient meets coverage requirements.
- Confirm that the diagnosis code submitted satisfies the NCD's covered indications.
- If the patient meets NCD criteria but the claim was denied, resubmit with corrected diagnosis coding and an ABN if applicable.
- If coverage is excluded under the NCD, issue the patient a formal denial notice and explore secondary payer or self-pay options.
Appeal Tips
- Your remittance returned CO-50 with RARC N386, citing a National Coverage Determination. NCDs are federal coverage rules that apply to all Medicare claims nationwide. To appeal, document how the patient meets each covered indication in the applicable NCD, referencing the NCD number and version. Provide clinical documentation supporting the diagnosis and the medical necessity of the service. If the service falls into a non-covered category under the NCD, an ABN may shift financial responsibility to the patient.
Prevention Strategy
- Map every high-volume procedure code to its LCD/NCD and build a pre-submission checklist listing each required coverage criterion.
- Implement a prior authorization (PA) workflow for all PA-required procedures and attach the auth number to the claim.
- Train clinical staff to document the specific indication, failed conservative treatments, and decision rationale using language that mirrors LCD/NCD criteria.
CARC 50 + RARC N372. Documentation scenario.
CARC 50
+
RARC N372
=
This combination tells a more specific story than CARC 50 alone. The CARC identifies the category of denial; RARC N372 points to the specific field, data element, or clinical element driving it. The payer determined the service was not medically necessary based on the information submitted. This typically reflects documentation that did not meet coverage criteria rather than inappropriate care.
Common drivers: Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
Common drivers: Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
CARC 50 with RARC N372 - Billed Service Not Covered by Health Plan scenario.
RARC N372, Official Definition
Only reasonable and necessary maintenance/service charges are covered.
Root Causes
- Clinical notes did not address LCD/NCD coverage criteria; diagnosis-to-procedure linkage weak; documentation lacked specificity on failed conservative treatments; or required authorization not obtained.
Action Plan
- Review CO-50 in full alongside RARC N372 on your remittance. Your remittance also returned RARC N372: 'Only reasonable and necessary maintenance/service charges are covered'. Address this specific issue in addition to the CO-50 root cause.
- Pull the original claim and confirm that the data element or condition cited by RARC N372 (Only reasonable and necessary maintenance/service charges are covered) was correctly submitted.
- Correct any identified error or omission in the claim data and resubmit with a corrected claim indicator.
- If the denial cannot be resolved through corrected resubmission, prepare a written reconsideration citing the specific RARC N372 finding and providing supporting documentation.
Appeal Tips
- Your remittance returned CO-50 with RARC N372: 'Only reasonable and necessary maintenance/service charges are covered'. This RARC provides additional context specific to your claim. To address it, identify the exact data or clinical issue cited by RARC N372 and gather documentation that directly resolves it. Submit a reconsideration or corrected claim with a cover letter that acknowledges both the CO-50 denial reason and the RARC N372 modifier, and explains how the submitted documentation addresses each. If you need further clarification on what is required, contact the payer's provider relations line and reference both codes.
Prevention Strategy
- Map every high-volume procedure code to its LCD/NCD and build a pre-submission checklist listing each required coverage criterion.
- Implement a prior authorization (PA) workflow for all PA-required procedures and attach the auth number to the claim.
- Train clinical staff to document the specific indication, failed conservative treatments, and decision rationale using language that mirrors LCD/NCD criteria.
Common RARC pairings with CARC 50
These pairings and definitions can also be found in the EDI Code Intelligence Lab. ASC X12 Definitions are sourced from x12.org/codes/remittance-advice-remark-codes. Business Scenarios are sourced from CAQH CORE required code combinations (v3100, February 2026).
| RARC | Official definition (ASC X12) | Business scenario (CAQH CORE) |
|---|---|---|
| M1 | X-ray not taken within the past 12 months or near enough to the start of treatment. | Billed Service Not Covered by Health Plan |
| M25 | The information furnished does not substantiate the need for this level of service. If you believe the service should have been fully covered as billed, or if you did not know and could not reasonably have been expected to know that we would not pay for this level of service, or if you notified the patient in writing in advance that we would not pay for this level of service and he/she agreed in writing to pay, ask us to review your claim within 120 days of the date of this notice. If you do not request an appeal, we will, upon application from the patient, reimburse him/her for the amount you have collected from him/her in excess of any deductible and coinsurance amounts. We will recover the reimbursement from you as an overpayment. | Billed Service Not Covered by Health Plan |
| M26 | The information furnished does not substantiate the need for this level of service. If you have collected any amount from the patient for this level of service/any amount that exceeds the limiting charge for the less extensive service, the law requires you to refund that amount to the patient within 30 days of receiving this notice. The requirements for refund are in 1824(I) of the Social Security Act and 42CFR411.408. The section specifies that physicians who knowingly and willfully fail to make appropriate refunds may be subject to civil monetary penalties and/or exclusion from the program. If you have any questions about this notice, please contact this office. | Billed Service Not Covered by Health Plan |
| M31 | Missing radiology report. | Billed Service Not Covered by Health Plan |
| M51 | Missing/incomplete/invalid procedure code(s). | Billed Service Not Covered by Health Plan |
| M60 | Missing Certificate of Medical Necessity. | Billed Service Not Covered by Health Plan |
| M64 | Missing/incomplete/invalid other diagnosis. | Billed Service Not Covered by Health Plan |
| M76 | Missing/incomplete/invalid diagnosis or condition. | Billed Service Not Covered by Health Plan |
| M85 | Subjected to review of physician evaluation and management services. | Billed Service Not Covered by Health Plan |
| M127 | Missing patient medical record for this service. | Billed Service Not Covered by Health Plan |
This is one code. The Lab covers every CARC and RARC in use today.
Root causes, action plans, appeal guidance, and prevention strategy for every code, plus the CARC and RARC pairing tool that completes the picture. Verified against the current ASC X12 master lists updated July 1, 2026. Not a glossary. A playbook.
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Use this page as a starting point, not the final word. Every denial carries context that only the payer and the claim itself can provide. Before you submit an appeal or a corrected claim, verify the payer's published policies and reach out to the payer directly with questions about your specific situation. Nothing on this page is legal, coding, or clinical advice.