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N174 Remark Code: Non-Covered, Patient Liability Capped

N174 means the service, procedure, equipment, or bed was not covered by the plan, but the patient's financial liability is limited to the amounts the payer reported under group code PR on the remittance. Anything outside PR is not collectible from the patient.

Quick facts

Code
N174 (RARC N174)
Status
Active In use since February 28, 2003.
Code set
Remittance Advice Remark Codes (RARC)
Group codes
  • PR (Patient Responsibility): These are the only amounts the patient can be billed for on this non-covered service. N174 caps patient liability at what appears here.
  • CO (Contractual Obligation): Amounts under CO are the provider's write-off. N174 reinforces that the non-covered balance beyond the PR portion cannot be shifted to the patient.
Official description
This is not a covered service/procedure/ equipment/bed, however patient liability is limited to amounts shown in the adjustments under group 'PR'.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What N174 means

N174 combines two messages. First, the payer did not cover the line: it could be a procedure, a piece of equipment, or a bed day. Second, it tells you exactly how far the patient can be billed: only up to the dollar amounts listed with group code PR on the remittance. The rest of the charge is off limits for patient billing.

You’ll usually see it with CARC 96 or CARC 204 for non-covered items, or CARC 50 when the payer did not accept medical necessity. The remark code is common on durable medical equipment and room-and-board lines, where an upgraded item or a private room may be partly the patient’s choice.

Common causes

  • The patient received an upgraded or deluxe item and the plan covers only the standard version.
  • A private room or other bed type was billed without the clinical justification the plan requires.
  • The service falls under a plan exclusion, but contract or regulatory rules restrict what can be collected from the member.
  • Advance notice to the patient was missing or incomplete, which limits what can legitimately move to patient responsibility.

What to do

  1. Read the adjustments on the line group by group. Post the PR amounts to the patient and the CO or OA amounts as adjustments.
  2. Compare any patient statement already sent against the PR total; refund or correct if the patient was billed more.
  3. If an advance notice or waiver was signed, confirm whether the payer recognised it. Where it wasn’t recognised but should have been, contact the payer or file a reconsideration with a copy of the notice.
  4. If the item was covered but billed with the wrong code or modifier, submit a corrected claim with resubmission code 7 in box 22 and the original claim number.
  5. Appeal only with documentation that supports coverage.

How to prevent it

Check benefits for equipment and upgrades before delivery, and use the payer’s advance-notice process when a patient chooses a non-covered option. When your system posts remits, map patient balances strictly from PR adjustments so a non-covered line cannot drift into a patient statement by accident.

Codes that may appear with N174

  • CO-96 (Non-covered charge(s).): Non-covered charges; N174 then limits how much of that charge may be billed to the patient.
  • PR-204 (This service/equipment/drug is not covered under the patient's current benefit plan): The service or equipment is not covered under the patient's current plan, with N174 setting the patient's share.
  • CO-50 (These are non-covered services because this is not deemed a 'medical necessity' by the payer.): The payer judged the service not medically necessary; N174 clarifies how much, if any, shifts to the patient.
  • N172 (The patient is not liable for the denied/adjusted charge(s) for receiving any updated service/item.): States the patient is not liable at all for the denied or adjusted charges, rather than capping liability.
  • MA13 (Alert: You may be subject to penalties if you bill the patient for amounts not reported with the PR (patient responsibility) group code.): Warns that billing the patient for amounts not reported as PR can carry penalties.
  • M38 (Alert: The patient is liable for the charges for this service as they were informed in writing before the service was furnished that we would not…): Indicates the patient is liable because they were informed in writing before the service.

N174 FAQ

Can I bill the patient the full charge after N174?

No. The patient's responsibility is limited to the amounts shown under group PR on that remittance. The rest belongs under CO or another group and should not be transferred to the patient.

What if the PR amount is zero?

Then N174 effectively means the patient owes nothing for that line, even though the service was not covered. The balance is a provider adjustment unless you win an appeal.

Should I appeal an N174 line?

Only if you believe the service should have been covered, for example because documentation supports medical necessity or the item was billed under the wrong code. The remark code itself describes liability, not an error.