Skip to main content

N699 Remark Code: PQRS Payment Adjustment

N699 means the payment was adjusted under the Physician Quality Reporting System (PQRS), a Medicare quality reporting program. Eligible professionals who didn't satisfactorily report quality measures had their Medicare fee schedule payments reduced in a later year.

Quick facts

Code
N699 (RARC N699)
Status
Active In use since March 1, 2014.
Code set
Remittance Advice Remark Codes (RARC)
Group codes
  • CO (Contractual Obligation): The PQRS reduction is a program adjustment the provider absorbs. It can't be billed to the patient.
Official description
Payment adjusted based on the Physician Quality Reporting System (PQRS) Incentive Program.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What N699 means

The Physician Quality Reporting System asked eligible professionals billing Medicare to report quality measures on their patients. It started as a voluntary incentive program and later added penalties: professionals who didn’t report satisfactorily in a performance year saw their Medicare Physician Fee Schedule payments reduced by a set percentage in a later payment year.

N699 identifies that reduction on a Medicare remittance. The service was paid, but less than the full fee schedule amount because of the provider’s PQRS status for the relevant performance year.

Current status

The Medicare Access and CHIP Reauthorization Act (MACRA) consolidated PQRS, the Value-based Payment Modifier, and the Medicare EHR Incentive Program for eligible professionals into the Merit-based Incentive Payment System (MIPS). PQRS adjustments ended with the 2018 payment year. Today, quality-related Medicare adjustments appear with N807 instead.

When you might still encounter it

  • Historical analysis of remittances from the years PQRS adjustments applied.
  • Reprocessed or reopened claims from those years.
  • Older payer systems that reuse the code in their own quality programs. If a non-Medicare payer sends N699, ask it what program the adjustment reflects.

What to do

For a PQRS-era claim, the adjustment is final. Post it as a program adjustment, not a denial, and don’t bill the patient. For current-year Medicare claims, look at your MIPS status and feedback to understand quality-based adjustments. When analyzing remittance history, group N699, N700, and N701 together as legacy Medicare program adjustments so they don’t distort current denial reporting.

Codes that may appear with N699

  • CO-237 (Legislated/Regulatory Penalty.): A legislated or regulatory penalty, the reason code used to report the reduction amount.
  • N807 (Payment adjustment based on the Merit-based Incentive Payment System (MIPS).): Payment adjustment under the Merit-based Incentive Payment System (MIPS), which replaced PQRS.
  • N700 (Payment adjusted based on the Electronic Health Records (EHR)): Payment adjustment under the Electronic Health Records Incentive Program.
  • N701 (Payment adjusted based on the Value-based Payment Modifier.): Payment adjustment under the Value-based Payment Modifier.
  • N545 (Payment reduced based on status as an unsuccessful eprescriber per the Electronic Prescribing (eRx)): A reduction under the earlier Electronic Prescribing (eRx) Incentive Program.

N699 FAQ

Does PQRS still exist?

No. Under MACRA, PQRS was folded into the Merit-based Incentive Payment System (MIPS), and PQRS-based payment adjustments ended after the 2018 payment year.

Why would I still see N699?

Mainly on older claims, reprocessed claims, or historical remittance data. Current quality-based adjustments are reported under MIPS instead.

Could a PQRS adjustment be appealed?

CMS offered an informal review process for PQRS determinations during the program years. Those windows have long closed.