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OA-271 Denial Code: Prior Reductions on Periodic Payment

OA-271 reports prior contractual reductions related to a current periodic payment made under a contractual payment schedule, where the deferred amounts were already reported on earlier remittances. It's an informational reconciliation adjustment, not a denial.

Quick facts

Code
OA-271 (CARC 271)
Status
Active In use since November 1, 2015; last modified March 1, 2018.
Code set
Claim Adjustment Reason Codes (CARC)
Group codes
  • OA (Other Adjustment): The only group X12 allows for CARC 271. It doesn't assign new responsibility to the provider or patient; it ties the current payment back to reductions reported earlier.
Official description
Prior contractual reductions related to a current periodic payment as part of a contractual payment schedule when deferred amounts have been previously reported. (Use only with Group Code OA)
X12 Claim Adjustment Reason Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What OA-271 means

CARC 271 describes prior contractual reductions related to a current periodic payment as part of a contractual payment schedule when deferred amounts have been previously reported. X12 limits it to group code OA.

In plain terms: some contracts don’t pay claims in a single payment. The payer may defer part of the amount and release it later in installments, on a schedule set in the agreement. When the payer reported the deferral earlier, it also reported any contractual reductions at that time. When a later installment arrives, OA-271 references those earlier reductions so your posting reconciles, without implying a new reduction.

This is uncommon in everyday physician billing. It appears mainly in arrangements with scheduled or periodic payments, such as certain institutional contracts, settlement arrangements, or payment programs that spread reimbursement over time.

Common causes

  • Contractual payment schedules that split claim payments into installments.
  • Deferred amounts reported on an earlier remittance (CARC 143 is one way payers show a deferral).
  • Final installment reconciliation where the payer lists prior reductions to close the balance.

How to handle it

  1. Find the original remittance where the deferral and reductions were reported.
  2. Match the installment to your contract’s payment schedule.
  3. Post the current payment and apply OA-271 in a way that doesn’t double-count earlier reductions.
  4. Track the remaining deferred balance until the final installment (N85).
  5. Contact the payer if the installment amounts or remaining balance don’t match the schedule.

How to prevent reconciliation problems

  • Document periodic payment terms in your contract summary, including the schedule and how reductions are reported.
  • Set up deferred receivables in your system so installments post against them.
  • Reconcile installments monthly against the schedule.
  • Separate these adjustments from denials. An ERA Analyzer can isolate OA-271 lines so they don’t inflate denial or write-off reporting.

Specialty notes

Hospitals and large groups with negotiated payment schedules, or with settlement agreements that pay over time, are the most likely to see OA-271. Smaller practices seeing it should ask the payer what arrangement it relates to.

Remark codes that may appear with OA-271

  • N84 (Alert: Further installment payments are forthcoming.): Further installment payments are forthcoming.
  • N85 (Alert: This is the final installment payment.): This is the final installment payment.
  • CO-143 (Portion of payment deferred.): Portion of payment deferred, the code often used when a deferral is first reported.
  • CO-45 (Charge exceeds fee schedule/maximum allowable or contracted/legislated fee arrangement.): The standard contractual reduction, which may have been reported with the original claim.
  • CO-104 (Managed care withholding.): Managed care withholding, another way part of a payment is held back.
  • CO-245 (Provider performance program withhold.): Provider performance program withhold.

OA-271 FAQ

When does OA-271 appear?

When a payer pays claims under a contractual payment schedule, deferring part of the payment and releasing it in periodic installments. On later remittances, OA-271 accounts for reductions that were already reported, so they aren't counted twice.

Should I post OA-271 as a write-off?

Generally not as a new write-off. The reductions were already reported on an earlier remittance. Post it so the claim reconciles, following your system's rules for deferred payments.

Can I bill the patient for OA-271?

No. It's a reconciliation between the payer and provider, not patient responsibility.

How do I know the installments are correct?

Compare the payment schedule in your contract with the installments received and the deferred amounts reported earlier. Contact the payer if the totals don't match.