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CARC 116 · CO-116

CARC 116 Denial: The advance indemnification notice signed by the patient did not comply with re… — How to Fix and Appeal

Reviewed by QuickIntell RCM Editorial Team · Last reviewed

Updated

TL;DR

CARC 116 (X12 The advance indemnification notice signed by the patient did not comply with requirements). CARC 116 rejects an ABN-based denial because the ABN (Advance Beneficiary Notice) was incomplete or non-compliant.

Official X12 description

“The advance indemnification notice signed by the patient did not comply with requirements.”

Source: X12 Claim Adjustment Reason Codes. The X12 External Code Lists are the single authoritative source for every CARC descriptor — always verify against the current release before building a claim-scrub rule.

What CARC 116 actually means

CARC 116 rejects an ABN-based denial because the ABN (Advance Beneficiary Notice) was incomplete or non-compliant. Re-execute a compliant ABN for future services; cannot retroactively cure a non-compliant one.

Common root causes

  • ABN missing elements (service, reason for expected denial, estimated cost, patient signature/date).

Prevention checklist

  • ABN template and training aligned to CMS requirements.

Appeal strategy — step by step

Most CARC 116 denials clear faster with the right remediation than with a formal appeal. Work the steps in order and escalate only when a lower-effort path has been ruled out.

  1. 1Cannot retroactively cure an invalid ABN; absorb the cost or pursue limited appeal if the service was ultimately covered.
Sample appeal-letter language for CARC 116
[Provider letterhead] Re: Appeal of CARC 116 — Claim #{claim_number} Member: {member_name} · Member ID: {member_id} Date(s) of Service: {dos} On {remittance_date} this claim was adjusted with CARC 116: "The advance indemnification notice signed by the patient did not comply with requirements." We respectfully request reconsideration. The X12 External Code List definition of CARC 116 does not apply to this claim for the following reasons: 1. [Cite the clinical / coding / policy fact that rebuts the adjustment] 2. [Cite the supporting documentation attached — op note, EOB, LCD/NCD citation, NCCI edit indicator, modifier rationale] 3. [Cite the payer's own policy where applicable] Attached: {list supporting documents} Please process payment under the member's benefits. If additional information is required, contact the billing office at {provider_phone} or {provider_email}. Sincerely, {billing_manager_name}, {credentials}

Edit the bracketed fields before sending. This template is a starting point; a payer-specific appeal form may still be required — check the provider portal first.

Payer-specific notes

Payer-specific behavior for CARC 116 publishes here as the QuickIntell anonymized denial ETL ingests sufficient volume. In the meantime, consult the payer directory for the relevant provider manual and appeal form.

How common is CARC 116?

Search demand rank
#138

Out of 306 seeded CARCs, ranked by combined US monthly search volume for "CARC 116", "CO-116 denial", and "denial code 116".

Platform frequency
Pending ETL

Platform frequency ranks publish once the anonymized denial-rate pipeline reaches the publication threshold (strategy §12 Phase 2).

How QuickRCM prevents CARC 116

QuickRCM catches the root causes above before the 837 leaves the clearinghouse:

  • Claim-scrub rules fire on every root cause listed above — the scrub references the same X12 CAS segment logic that drives the denial, so what the payer checks, QuickRCM checks first.
  • When a denial lands, QuickRCM routes it to the correct worker with the documentation bundle already attached (op note, LCD citation, modifier rationale, EOB, primary 835).
  • Appeal templates tuned to each CARC (including this one) pull the supporting facts from the claim and fill the bracketed fields automatically.
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Frequently asked questions — CARC 116

What does CARC 116 mean?

CARC 116 is an X12 Claim Adjustment Reason Code. The official definition is: "The advance indemnification notice signed by the patient did not comply with requirements." In plain English, the payer is telling you cARC 116 rejects an ABN-based denial because the ABN (Advance Beneficiary Notice) was incomplete or non-compliant. Re-execute a compliant ABN for future services; cannot retroactively cure a non-compliant one.

How do I resolve a CARC 116 (CO-116) denial?

Start with the most common root cause: ABN missing elements (service, reason for expected denial, estimated cost, patient signature/date). First step: Cannot retroactively cure an invalid ABN; absorb the cost or pursue limited appeal if the service was ultimately covered. See the full remediation and appeal checklist on this page before filing a formal appeal.

Is CARC 116 patient responsibility?

No — CARC 116 is typically carried under CO (Contractual Obligation) or OA (Other Adjustment), which means it is the provider's responsibility, not the patient's. Do not bill the patient unless the 835 CAS group code is PR.

What does CARC 116 look like on an EOB or 835 remittance?

On the 835 ERA, CARC 116 appears in Loop 2110 CAS segment as "CAS*CO*116*{amount}". On a paper EOB the same code prints in the Adjustment/Denial Reason column with the X12 description: "The advance indemnification notice signed by the patient did not comply with requirements." — usually paired with one or more RARC remark codes in the same remittance line for additional context.

Can CARC 116 be appealed successfully?

Yes — when the root cause does not apply to the specific claim. Overturn rates are strongest when the appeal cites the X12 definition, the payer's own published policy, and documentation that rebuts the payer's rationale. The sample appeal language block above is a starting point; always adapt it to the payer's reconsideration form.

Disclaimer

This page is operational reference for medical-billing professionals. It is not legal, clinical, or contractual advice. X12 code descriptors are maintained by the X12 External Code Lists; always verify against the current X12 release and the payer's own published policy before submitting or appealing a claim.