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M97 Remark Code: Paid Through the Facility's Payment

M97 means the payer will not pay the practitioner for this service in this place of service, because payment for it is included in the reimbursement issued to the facility. You may need to seek payment from the facility instead.

Code: M97 (RARC M97)
Status: Active In use since January 1, 1997.
Code set: Remittance Advice Remark Codes (RARC)
Group codes: CO (Contractual Obligation): The service is a write-off on your claim. Payment, if any, comes through the facility's reimbursement.
Official description: Not paid to practitioner when provided to patient in this place of service. Payment included in the reimbursement issued the facility.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified: September 24, 2026 against the official X12 list.

What M97 means

When a patient receives care in certain facilities, the facility’s payment is designed to cover a set of services. If a practitioner or supplier bills separately for one of those services, the payer denies it and points to the facility. M97 explains that denial: the service is covered, but not payable to you in this setting, because the facility’s reimbursement already includes it.

This is different from a pure coding error. The service might be paid in full if furnished in another setting.

Common causes

Services furnished to patients in a stay covered by a bundled facility payment.
Supplies or therapy billed by an outside provider while the patient was in the facility.
An office or home place of service reported when the patient was in fact a facility patient, or the reverse.
No arrangement with the facility for services the facility is responsible for.

How to fix it

Confirm the patient’s status and location on the date of service.
If the POS or dates were wrong, correct them and submit a corrected claim with frequency code 7.
If the service is part of the facility’s payment, bill the facility under your arrangement instead of the payer.
If you believe the service is separately payable to practitioners in that setting, ask the payer for the policy basis and appeal with it.

How to prevent it

Check whether patients are in a covered facility stay before providing or billing services.
Set up written arrangements with facilities you serve regularly.
Validate POS against the patient’s status with a Claims Validator.

Codes that may appear with M97

CO-171 (Payment is denied when performed/billed by this type of provider in this type of facility.): Payment is denied when this type of provider bills the service in this type of facility.
CO-97 (The benefit for this service is included in the payment/allowance for another service/procedure that has already been adjudicated.): The benefit is included in the payment for another service, here the facility payment.
CO-58 (Treatment was deemed by the payer to have been rendered in an inappropriate or invalid place of service.): The payer considers the place of service inappropriate for separate practitioner billing.

M96 (The technical component of a service furnished to an inpatient may only be billed by that inpatient facility.): Specific to the technical component of a service for a hospital inpatient.
N70 (Consolidated billing and payment applies.): Consolidated billing applies, often seen for skilled nursing and home health stays.
M77 (Missing/incomplete/invalid/inappropriate place of service.): The place of service code itself is missing, invalid, or inappropriate.

M97 FAQ

Which services does M97 usually affect?

Services that facilities are paid to provide as part of a bundled payment, such as supplies, some therapy, or other non-physician services during a facility stay. It varies by payer and setting.

Is M97 a POS coding error?

Not necessarily. The POS may be correct. M97 says that in that setting the payment belongs to the facility.

What if the patient was not in the facility?

If the place of service was reported wrongly, correct it and resubmit. If the payer's records are wrong, provide proof of the patient's status.

Important: read before using this information

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