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N649 Remark Code: Priced From the Invoice

N649 means the payer set the allowed amount using the invoice you supplied, rather than a fee schedule rate. It is common for items without a fixed price, such as implants, custom devices, and some drugs or supplies.

Quick facts

Code
N649 (RARC N649)
Status
Active In use since July 15, 2013.
Code set
Remittance Advice Remark Codes (RARC)
Group codes
  • CO (Contractual Obligation): Charges above the invoice-based allowed amount are a contractual or fee schedule reduction and are not billed to the patient.
  • PR (Patient Responsibility): Deductible or coinsurance on the invoice-based allowed amount is reported under PR.
Official description
Payment based on invoice.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What N649 means

Some items do not have a fixed payer rate. Miscellaneous HCPCS codes, custom-fabricated devices, surgical implants, compounded products, and new items not yet on a schedule are often priced by invoice. The provider sends the purchase invoice and the payer uses it as the basis for the allowed amount, sometimes adding a percentage or subtracting discounts.

N649 confirms that is what happened on this line. It is a pricing explanation, not a denial.

How invoice pricing usually works

  • The payer reads the net cost from the invoice, which may exclude shipping, handling, or tax depending on its rules.
  • It applies the method in your contract or the applicable fee schedule, such as cost only, cost plus a percentage (see N645), or a percentage of the manufacturer’s list price.
  • It multiplies by the units billed and compares the result to your charge.

When to follow up

  • The payer used the wrong line from a multi-item invoice.
  • Units don’t match, for example a box price treated as a single unit or the reverse.
  • Discounts were double-counted, or a rebate you never received was subtracted.
  • The percentage applied does not match your agreement or the jurisdiction’s rules.

What to do

  1. Match the allowed amount to the invoice line, quantity, and the payer’s pricing rule.
  2. Accept and post the adjustment when the calculation is correct.
  3. If it is wrong, send the payer a marked-up copy of the invoice showing the correct item and price, with your calculation, and request reprocessing.
  4. If the invoice was unclear, submit a corrected claim with resubmission code 7 and a clean invoice, following the payer’s attachment instructions.

Label invoices with the patient, date of service, and claim line before attaching them, and highlight the relevant item. That reduces pricing errors on multi-item invoices.

Codes that may appear with N649

  • CO-45 (Charge exceeds fee schedule/maximum allowable or contracted/legislated fee arrangement.): The billed charge exceeded the invoice-based allowed amount.
  • N645 (Mark-up allowance.): A mark-up allowance added on top of the invoice cost.
  • M23 (Missing invoice.): The payer needed an invoice and did not receive one.
  • N354 (Incomplete/invalid invoice.): The invoice sent was incomplete or invalid.
  • CO-220Deactivated (The applicable fee schedule/fee database does not contain the billed code.): The fee schedule does not contain the billed code, a frequent reason a payer turns to the invoice.

N649 FAQ

Why did the payer use the invoice?

Usually because the code has no fixed fee schedule amount, is a miscellaneous or unlisted code, or the contract says certain items are paid based on cost.

What should the invoice show?

Payers generally want the manufacturer or supplier name, item description, quantity, and the net price actually paid after discounts. Requirements vary, so check the payer's attachment policy.

Is N649 a problem?

Only if the allowed amount does not match your invoice cost plus whatever percentage the contract or schedule allows.