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CO-P1 Denial Code: State-Mandated P&C Requirement

CO-P1 means a property and casualty payer (auto, workers' compensation, or liability) adjusted the claim because of a state-mandated requirement. The code itself is generic; the accompanying remark code tells you which state rule was applied.

Quick facts

Code
CO-P1 (CARC P1)
Status
Active In use since November 1, 2013.
Code set
Claim Adjustment Reason Codes (CARC)
Group codes
  • CO (Contractual Obligation): The usual group. The adjustment follows state rules and the provider can't bill the injured person for it, subject to that state's regulations.
  • PR (Patient Responsibility): Rare. It would mean the state rule allows the amount to be charged to the claimant. Confirm the state's balance billing rules first.
Official description
State-mandated Requirement for Property and Casualty, see Claim Payment Remarks Code for specific explanation. To be used for Property and Casualty only.
X12 Claim Adjustment Reason Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What CO-P1 means

CARC P1 says state-mandated requirement for property and casualty, see Claim Payment Remarks Code for specific explanation. X12 restricts it to property and casualty (P&C) claims: workers’ compensation, auto medical coverage such as personal injury protection (PIP) and medical payments, and liability coverage. It replaced deactivated CARC 162.

P&C medical bills are governed heavily by state law. States set fee schedules, billing forms, required reports, treatment guidelines, and deadlines for workers’ comp and auto no-fault claims. CO-P1 is a catch-all that says “a state rule drove this adjustment.” It doesn’t say which rule, which is why the remark code is essential.

This code does not apply to group health, Medicare, or Medicaid claims. If you see it, you’re dealing with an auto, workers’ comp, or liability carrier (or its bill review vendor).

Common causes

  • State fee schedule limits applied to the billed amount.
  • State-required forms or reports missing, such as a jurisdiction’s medical report form.
  • Billing format rules, for example required codes, modifiers, or claim forms under state regulation.
  • State filing deadlines for P&C medical bills.
  • Services excluded from the state’s fee schedule.

How to fix it

  1. Read the remark code to identify the specific state rule.
  2. Look up the rule in the state’s workers’ comp or auto insurance regulations, or the state fee schedule.
  3. If documentation or a form was missing, resubmit the bill with it according to the carrier’s and state’s resubmission rules.
  4. If you disagree, request reconsideration with the carrier or bill review company, then use the state’s dispute process if needed.
  5. Check state balance billing rules before billing the injured person.

How to prevent it

  • Know the rules of each state where you treat P&C patients, including fee schedules and required forms.
  • Set up P&C cases separately from health insurance in your billing system, with the claim number, adjuster, and date of injury.
  • Track state-specific deadlines for bills and disputes.

Specialty notes

Orthopedic, chiropractic, PT, and occupational medicine practices handle most P&C claims. Practices near state borders often treat patients whose claims fall under another state’s rules, which may use a different fee schedule.

Remark codes that may appear with CO-P1

  • N603 (This fee is calculated according to the New Jersey medical fee schedules for Automobile Personal Injury Protection and Motor Bus Medical Expense…): An example of a state rule: fees calculated under New Jersey's auto PIP fee schedules.
  • N604 (In accordance with New York No-Fault Law, Regulation 68, this base fee was calculated according to the New York Workers' Compensation Board Schedule…): An example of New York no-fault fees calculated under the state's workers' compensation schedule.
  • N643 (The services billed are considered Not Covered or Non-Covered (NC) in the applicable state fee schedule.): The services are listed as not covered in the applicable state fee schedule.
  • CO-162Deactivated (State-mandated Requirement for Property and Casualty, see Claim Payment Remarks Code for specific explanation.): The deactivated code that CARC P1 replaced.
  • CO-P13 (Payment reduced or denied based on workers' compensation jurisdictional regulations or payment policies, use only if no other code is applicable.): Workers' comp payment reduced or denied based on jurisdictional regulations.
  • CO-P12 (Workers' compensation jurisdictional fee schedule adjustment.): Workers' comp jurisdictional fee schedule adjustment.
  • CO-223 (Adjustment code for mandated federal, state or local law/regulation that is not already covered by another code and is mandated before a new code…): An adjustment for a mandated federal, state, or local law not covered by another code, used outside P&C.

CO-P1 FAQ

Is CO-P1 used by health insurers?

No. X12 limits CARC P1 to property and casualty claims: auto insurance (including PIP and medical payments), workers' compensation, and liability coverage.

How do I find out which rule was applied?

Read the remark code on the same line or claim. The official text says to see the Claim Payment Remark Code for the specific explanation. If none is present, ask the adjuster or bill review company.

Can I dispute a CO-P1 adjustment?

Yes, if you believe the state rule was misapplied. Most states have a bill review, reconsideration, or dispute process for P&C medical bills, often with strict deadlines.

Can I bill the injured person the difference?

Usually not. Many states restrict balance billing of injured workers and auto claimants for services covered under state fee schedules. Check the applicable state law.