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M26 Remark Code: Level Not Supported, Patient Refund Due

M26 means the payer found the level of service was not supported by the information provided. If you collected more from the patient than allowed for the lesser service, you must refund the excess within 30 days of the notice.

Code: M26 (RARC M26)
Status: Active In use since January 1, 1997; last modified November 5, 2007.
Code set: Remittance Advice Remark Codes (RARC)
Group codes: CO (Contractual Obligation): The reduction is the provider's liability, and excess patient collections must be returned.
Official description: The information furnished does not substantiate the need for this level of service. If you have collected any amount from the patient for this level of service/any amount that exceeds the limiting charge for the less extensive service, the law requires you to refund that amount to the patient within 30 days of receiving this notice. The requirements for refund are in 1824(I) of the Social Security Act and 42CFR411.408. The section specifies that physicians who knowingly and willfully fail to make appropriate refunds may be subject to civil monetary penalties and/or exclusion from the program. If you have any questions about this notice, please contact this office.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified: September 24, 2026 against the official X12 list.

What M26 means

M26 carries the same core finding as M25, that documentation did not justify the level of service, but its emphasis is the patient refund. It applies to Medicare situations, often involving non-participating physicians who collected from the patient up front. If you collected any amount for the higher level of service, or an amount above the limiting charge for the lower level, federal rules require you to refund the excess to the patient within 30 days of receiving the notice.

The official remark points to the specific Social Security Act section and regulation, and warns about penalties for knowing and willful failure to refund.

Common causes

A non-participating provider collected the full charge at the visit and the level was reduced on review.
Billing staff did not reconcile patient payments after a downcode.
The provider chose visit levels that the record did not support.

What to do

Identify what the patient paid for the service, including at the time of visit.
Calculate the allowable patient amount for the lower level, including the limiting charge if non-participating.
Refund the excess within 30 days of receiving the remittance, and document the refund date and amount.
Decide whether to appeal the level decision, and include the full record if you do.
Contact the payer with questions, as the remark itself invites.

How to prevent it

Reconcile patient collections against every remittance, not just denials, and audit level-of-service selection. See CARC and RARC denial analysis for reading level-of-service combinations.

Codes that may appear with M26

CO-150 (Payer deems the information submitted does not support this level of service.): The information submitted does not support this level of service.
CO-50 (These are non-covered services because this is not deemed a 'medical necessity' by the payer.): The higher level was not considered medically necessary.

M25 (The information furnished does not substantiate the need for this level of service.): Same level-of-service finding, focused on review rights and the 120-day request window.
N355 (Alert: The law permits exceptions to the refund requirement in two cases: - If you did not know, and could not have reasonably been expected to…): Explains exceptions to the refund requirement.
MA59 (Alert: The patient overpaid you for these services.): A general alert that the patient overpaid and must be refunded within 30 days.

M26 FAQ

What must be refunded under M26?

Any amount collected from the patient for the higher level of service, or any amount above the limiting charge for the less extensive service. Deductible and coinsurance for the service actually allowed are not refunded.

What are the consequences of not refunding?

The remark cites the federal statute and regulations behind the refund rule and warns that knowing and willful failure to refund can lead to civil monetary penalties or program exclusion.

Can I still appeal?

Yes. You can request a review of the level of service decision. Handle the refund timeline carefully while the appeal is pending, and ask the payer how it applies to your situation.

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