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CO-39 Denial Code: Authorization Denied When Requested

CO-39 means the payer denied the services at the time prior authorization or pre-certification was requested, and the claim was denied to match. The authorization was asked for but refused, so the path forward is usually an appeal of that medical necessity decision.

Quick facts

Code
CO-39 (CARC 39)
Status
Active In use since January 1, 1995.
Code set
Claim Adjustment Reason Codes (CARC)
Group codes
  • CO (Contractual Obligation): The usual group. The provider is responsible and can't bill the patient unless the patient agreed in writing, before the service, to pay after being told it was denied.
  • PR (Patient Responsibility): Used when the payer assigns liability to the patient, for example when the member was notified of the denied authorization and chose to proceed. Confirm your documentation before billing.
Official description
Services denied at the time authorization/pre-certification was requested.
X12 Claim Adjustment Reason Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What CO-39 means

CARC 39 says services denied at the time authorization or pre-certification was requested. Before the service, someone asked the payer to approve it. The payer refused, usually on medical necessity grounds. The service was then performed anyway, and the claim was denied to match the earlier decision.

That sequence matters. Unlike a missing authorization (CO-197), the payer has already reviewed the request and said no. Fixing the claim won’t help; you need to overturn the underlying decision.

See authorization and referral denials for how authorization workflows break down.

Common causes

  • Service performed after a denied authorization, for example because the denial wasn’t communicated to the clinician or scheduler.
  • Urgent situations where care proceeded while the authorization was denied or pending review.
  • Insufficient clinical information in the original request, leading to a denial that might have been approved with complete records.
  • Criteria not met under the payer’s medical policy, such as conservative treatment not tried first.
  • Denied request for one code while a different code was performed and billed.

How to fix it

  1. Pull the authorization denial letter and the criteria cited.
  2. Check whether the denial was appealed at the time and its outcome.
  3. Gather clinical documentation that addresses each criterion the payer cited, including prior treatments and test results.
  4. Request a peer-to-peer review if the payer offers one.
  5. File an appeal within the payer’s deadline. Some payers require appealing the authorization decision; others handle it through the claim appeal.
  6. Bill the patient only if the payer reports PR or you have a valid signed agreement. Otherwise write off after appeals are exhausted.

How to prevent it

  • Communicate authorization outcomes to schedulers and clinicians before the appointment.
  • Block scheduling of services whose authorizations are denied or pending, except in genuine emergencies.
  • Submit complete clinical information with every request, matched to the payer’s criteria.
  • Appeal denied authorizations before the service where possible.
  • Get informed financial consent from patients who choose to proceed after a denial, following payer and program rules.

Specialty notes

Imaging, surgery, and behavioral health levels of care (such as intensive outpatient or residential treatment) often see CO-39 when continued stays or higher levels of care are denied at concurrent review.

Remark codes that may appear with CO-39

  • N54 (Claim information is inconsistent with pre-certified/authorized services.): The claim information is inconsistent with what was pre-certified or authorized.
  • N758 (Adjusted based on the prior authorization decision.): The adjustment follows the prior authorization decision.
  • CO-197 (Precertification/authorization/notification/pre-treatment absent.): No authorization was obtained at all, rather than requested and denied.
  • CO-198 (Precertification/notification/authorization/pre-treatment exceeded.): Authorization was approved but the services exceeded it.
  • CO-50 (These are non-covered services because this is not deemed a 'medical necessity' by the payer.): Not medically necessary, decided on the claim rather than at the authorization stage.
  • CO-284 (Precertification/authorization/notification/pre-treatment number may be valid but does not apply to the billed services.): An authorization exists but doesn't apply to the billed services.

CO-39 FAQ

How is CO-39 different from CO-197?

CO-197 means no authorization was on file. CO-39 means someone requested authorization and the payer said no. With CO-39 the medical necessity decision has already been made, so resubmitting the claim alone won't change it.

Can I appeal a CO-39?

Yes. Appeal the authorization denial (or the claim denial, depending on the payer's process) with clinical documentation, and request a peer-to-peer review if available. Watch the appeal deadline.

Can I bill the patient for CO-39?

Only when the payer reports PR or the patient signed a valid agreement to pay after being told the service was denied. Otherwise the provider absorbs the amount.