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N71 Remark Code: Processed as Assigned by Law

N71 means an unassigned claim for a drug or biological, clinical diagnostic laboratory services, or ambulance service was processed as an assigned claim. For these services, the law requires the provider or supplier to accept assignment.

Quick facts

Code
N71 (RARC N71)
Status
Active In use since January 1, 2000; last modified June 30, 2003.
Code set
Remittance Advice Remark Codes (RARC)
Group codes
  • CO (Contractual Obligation): Because assignment is mandatory, the amount above the approved amount is not collectible from the patient beyond their cost-sharing.
  • PR (Patient Responsibility): Deductible and coinsurance calculated on the approved amount remain the patient's responsibility.
Official description
Your unassigned claim for a drug or biological, clinical diagnostic laboratory services or ambulance service was processed as an assigned claim. You are required by law to accept assignment for these types of claims.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What N71 means

Under Medicare, some providers can choose, claim by claim, whether to accept assignment. For certain services, though, assignment is required by law regardless of the provider’s participation status. N71 tells you that you submitted one of those services as unassigned, and the payer processed it as assigned anyway because that is the only option the law allows.

The practical impact is financial: payment goes to the provider, and the provider may collect only the patient’s cost-sharing on the approved amount. N71 is usually seen with CARC 45 and cost-sharing codes.

Common causes

  • A non-participating supplier’s billing system defaulted to unassigned for all claims.
  • Staff were unaware that drugs and biologicals, clinical lab, or ambulance services require assignment.
  • A claim mixed services with and without mandatory assignment.

What to do

  1. Post the payment as an assigned claim.
  2. Adjust the patient account. Limit the patient balance to the deductible and coinsurance shown.
  3. Refund any excess you collected from the patient for these services.
  4. Update billing settings so future claims for these services are submitted as assigned.

How to prevent it

Set your billing system to flag drugs, biologicals, clinical lab services, and ambulance services as mandatory-assignment items so the assignment indicator (box 27 on the CMS-1500) is always set correctly. Train front-desk staff not to collect full charges upfront for these services.

Codes that may appear with N71

  • CO-45 (Charge exceeds fee schedule/maximum allowable or contracted/legislated fee arrangement.): The charge was reduced to the approved amount, which the provider must accept under assignment.
  • PR-2 (Coinsurance Amount): Coinsurance on the approved amount is the patient's share.
  • MA09 (Alert: Claim submitted as unassigned but processed as assigned in accordance with our current assignment/participation agreement.): An unassigned claim processed as assigned under the provider's assignment or participation agreement.
  • MA72 (Alert: The patient overpaid you for these assigned services.): Alert that the patient overpaid for assigned services and must be refunded.
  • CO-111 (Not covered unless the provider accepts assignment.): The service is not covered unless the provider accepts assignment.

N71 FAQ

What does accepting assignment mean?

It means agreeing to accept the payer's approved amount as full payment, collecting only the patient's deductible and coinsurance, and receiving payment directly from the payer.

Which services require mandatory assignment?

N71 names drugs and biologicals, clinical diagnostic laboratory services, and ambulance services. Medicare has other mandatory assignment situations as well, so check current rules for your provider type.

What if I already collected the full charge from the patient?

You generally need to refund the patient the amount collected above their deductible and coinsurance. Follow the payer's instructions and timelines for refunds.