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CO-A2 Denial Code (Deactivated): Contractual Adjustment

CO-A2 was a generic contractual adjustment, the difference between billed charges and what the contract allowed. X12 deactivated it and its notes direct payers to use CARC 45 with group CO, or another more specific adjustment code.

X12 deactivated CARCA2 on January 1, 2008. Payers should no longer use it on new remittances, but it can still appear on older ERAs, corrected claims, and appeals.

Code: CO-A2 (CARC A2)
Status: Deactivated StoppedJanuary 1, 2008 (in use since January 1, 1995).
Code set: Claim Adjustment Reason Codes (CARC)
Group codes: CO (Contractual Obligation): A contractual write-off, not billable to the patient.
Official description: Contractual adjustment.
X12 Claim Adjustment Reason Codes, retrieved September 25, 2026
Last verified: September 24, 2026 against the official X12 list.

What CO-A2 meant

CARC A2 was the all-purpose contractual adjustment. Any amount the payer reduced under its agreement with the provider could be reported with it, whether the cause was a fee schedule, a discount, or a pricing rule. That made it easy for payers to use and hard for providers to analyze.

What replaced it

X12’s notes say to use code 45 with group CO, or another specific adjustment code. So CO-45 is the main successor for ordinary fee schedule and contract reductions. Where a more precise reason exists, payers are expected to use it, for example CO-131 for a claim-specific negotiated discount or CO-59 for multiple-procedure reductions.

If you still see CO-A2

It shows up in older remittances and in some legacy systems’ adjustment code tables. For reporting, group it with CARC 45 so your contractual adjustment trends stay consistent over time. When you work an old claim with CO-A2, compare the allowed amount to your fee schedule for that year. If the payment was short, the fact that the reason code was generic is a good reason to ask the payer exactly how the claim was priced.

CO-45 (Charge exceeds fee schedule/maximum allowable or contracted/legislated fee arrangement.): The replacement X12 names, used with group CO.
CO-131 (Claim specific negotiated discount.): A claim-specific negotiated discount, one of the more specific options.
CO-59 (Processed based on multiple or concurrent procedure rules. (For example multiple surgery or diagnostic imaging, concurrent anesthesia.)): Reductions from multiple or concurrent procedure rules.

CO-A2 FAQ

Why did X12 retire such a common code?

A generic contractual adjustment gave providers little information. Requiring CARC 45 or a more specific code tells the provider why the reduction happened.

Should CO-A2 be posted as a write-off?

Generally yes, after confirming the allowed amount matches your contract. If it does not, contact the payer about the underpayment.

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