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CO-Y2 Denial Code (Deactivated): MPC/PIP Adjustment

CO-Y2 meant an auto insurer adjusted payment based on Medical Payments Coverage or Personal Injury Protection jurisdictional regulations or payment policies, when no other code applied. X12 deactivated it and its notes direct payers to code P22.

X12 deactivated CARCY2 on July 1, 2014. Payers should no longer use it on new remittances, but it can still appear on older ERAs, corrected claims, and appeals.

Code: CO-Y2 (CARC Y2)
Status: Deactivated StoppedJuly 1, 2014 (in use since September 30, 2012).
Code set: Claim Adjustment Reason Codes (CARC)
Group codes: CO (Contractual Obligation): The reduction was a provider adjustment under auto coverage rules.
Official description: Payment adjusted based on Medical Payments Coverage (MPC) or Personal Injury Protection (PIP) Benefits jurisdictional regulations or payment policies, use only if no other code is applicable. Note: If adjustment is at the Claim Level, the payer must send and the provider should refer to the 835 Insurance Policy Number Segment (Loop 2100 Other Claim Related Information REF qualifier 'IG') if the jurisdictional regulation applies. If adjustment is at the Line Level, the payer must send and the provider should refer to the 835 Healthcare Policy Identification Segment (loop 2110 Service Payment information REF) if the regulations apply. To be used for P&C Auto only.
X12 Claim Adjustment Reason Codes, retrieved September 25, 2026
Last verified: September 24, 2026 against the official X12 list.

What CO-Y2 meant

CARC Y2 belonged to the auto insurance Y-series. It reported a reduction, not a full denial, applied to a Medical Payments Coverage or Personal Injury Protection claim because of state regulations or the carrier’s payment policies. It was meant for cases without a more specific code, and the payer was supposed to cite the rule in the 835’s reference fields.

What replaced it

X12’s note says to use code P22. CO-P22 carries the same description in the P-series. If the reduction is specifically to a state fee schedule, carriers use CO-P23. A full MPC or PIP denial is CO-P21.

If you still see CO-Y2

You will find it only in older auto files. Get the regulation or policy the carrier relied on, compare it with the service billed, and dispute the reduction through the carrier’s or state’s process if it was misapplied. If remaining amounts may be owed by another coverage, bill that coverage next.

CO-P22 (Payment adjusted based on the Medical Payments Coverage (MPC) and/or Personal Injury Protection (PIP)): Named replacement: payment adjusted based on MPC or PIP jurisdictional regulations or payment policies.
CO-P23 (Medical Payments Coverage (MPC) or Personal Injury Protection (PIP)): MPC or PIP jurisdictional fee schedule adjustment.
CO-P21 (Payment denied based on the Medical Payments Coverage (MPC) and/or Personal Injury Protection (PIP)): Payment denied, rather than adjusted, under MPC or PIP rules.

CO-Y2 FAQ

How is Y2 different from Y1 and Y3?

Y1 was a denial, Y2 was a reduction based on rules or policies, and Y3 was a reduction specifically to a jurisdictional fee schedule. All three concerned auto MPC or PIP benefits.

Can the patient be billed for the reduced amount?

That depends on state law. Some states limit balance billing when PIP applies. Confirm the rule before sending a statement.

Important: read before using this information

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