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PR-201 Denial Code: Patient Owes via Set-Aside Agreement

PR-201 means the patient is responsible for the claim amount through a 'set-aside arrangement' or other agreement, typically funds set aside from a liability or no-fault settlement to pay future medical costs. It is used only with group code PR, and not by workers' compensation payers.

Quick facts

Code
PR-201 (CARC 201)
Status
Active In use since October 31, 2006; last modified September 28, 2014.
Code set
Claim Adjustment Reason Codes (CARC)
Group codes
  • PR (Patient Responsibility): The only group code allowed. The patient (or the set-aside fund they control) must pay the amount instead of the payer.
Official description
Patient is responsible for amount of this claim/service through 'set aside arrangement' or other agreement. (Use only with Group Code PR) At least one Remark Code must be provided (may be comprised of either the NCPDP Reject Reason Code, or Remittance Advice Remark Code that is not an ALERT.)
X12 Claim Adjustment Reason Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What PR-201 means

CARC 201 reads “Patient is responsible for amount of this claim/service through ‘set aside arrangement’ or other agreement.” Its usage note limits it to group code PR and requires at least one remark code. The X12 notes add that workers’ compensation payers must not use it; they use CARC P3 instead.

In practice, PR-201 is most often seen on Medicare claims where the patient settled a liability or no-fault injury case, and part of the settlement was set aside for future medical care. Medicare’s records show that set-aside, so it assigns responsibility for related services to the patient until the fund is exhausted.

Example: a patient injured in a car accident settles with the at-fault driver’s insurer, including a liability set-aside. Months later, the patient receives therapy for the same injury. Medicare denies the therapy claim as PR-201 with remark N723, meaning the set-aside funds should pay.

Common causes

  • An active liability or no-fault set-aside on file with the payer for the injury.
  • Diagnosis codes on the claim that link the service to the settled injury.
  • Unrelated services coded with injury-related diagnoses, pulling them into the set-aside.
  • Set-aside exhaustion not yet reported to the payer.

How to fix it

  1. Read the remark codes to see which kind of set-aside applies.
  2. Ask the patient about their settlement, who administers the set-aside, and how to bill it.
  3. Bill the set-aside fund or the patient for services related to the settled injury.
  4. If the service is unrelated, review diagnosis codes in box 21 and pointers in box 24E. Submit a corrected claim (resubmission code 7) if they were wrong, or appeal with records.
  5. If the fund is exhausted, ask the patient or administrator to provide the payer with proof, then request reprocessing.

How to prevent it

  • Ask about injury settlements at registration for patients receiving injury-related care, and record accident details in box 10 and box 14.
  • Keep set-aside information on the patient account, including the administrator’s contact details.
  • Code injury-related and unrelated care accurately so unrelated services aren’t swept into the set-aside.
  • Collect from the fund promptly; set-aside administrators may have their own documentation requirements. See COB and liability denials.

Specialty notes

Workers’ compensation claims don’t use CARC 201. If you see a settled workers’ compensation case with a Medicare set-aside, expect CARC P3 instead. Therapy, pain management, and orthopedic providers are most likely to see PR-201 because of their role in ongoing injury care.

Remark codes that may appear with PR-201

  • N723 (Patient must use Liability set-aside (LSA) funds to pay for the medical service or item.): The patient must use liability set-aside (LSA) funds to pay for the service.
  • N724 (Patient must use No-Fault set-aside (NFSA) funds to pay for the medical service or item.): The patient must use no-fault set-aside (NFSA) funds to pay for the service.
  • PR-P3 (Workers' Compensation case settled.): The workers' compensation version: a WC case settled with a Medicare set-aside. X12 notes say WC payers use P3 instead of 201.
  • CO-21 (This injury/illness is the liability of the no-fault carrier.): The injury is the liability of the no-fault carrier.
  • CO-20 (This injury/illness is covered by the liability carrier.): The injury is covered by the liability carrier.
  • OA-22 (This care may be covered by another payer per coordination of benefits.): Another payer may cover the care under coordination of benefits.

PR-201 FAQ

What is a set-aside arrangement?

When a patient settles an injury claim, part of the settlement may be set aside to pay future medical costs related to the injury. Medicare and some other payers expect those funds to be used first, before they pay for related care.

Who pays me after PR-201?

The patient or the administrator of their set-aside account. Ask the patient whether the fund is self-administered or professionally administered, and send the bill accordingly.

What if the service isn't related to the settled injury?

The set-aside should only apply to care for the settled injury. If the service is unrelated, correct the diagnosis codes if they were wrong and ask the payer to reprocess, or appeal with records showing the service is unrelated.

What happens when the set-aside funds run out?

The payer generally resumes paying for related care once the set-aside is properly exhausted and documented. The patient or administrator usually must provide proof of exhaustion to the payer.