RARC Codes Related to the No Surprises Act

May 4, 2022

Barbara Johnson, BSN, RN, CPC, FHFMA
Senior Revenue Cycle Consultant

Under HIPAA, all payers, including Medicare, are required to use claims adjustment reason codes (CARCs) and remittance advice remark codes (RARCs) approved by X12 recognized code set maintainers, instead of proprietary codes to explain any adjustment in the claim payment. RARCs are used to provide additional explanation for an adjustment already described by a CARC or to convey information about remittance processing. The following RARCs related to the No Surprises Act have been approved by the RARC Committee and were effective as of March 1, 2022.

The No Surprises Act provisions that apply to the claim

RARC #	RARC Text
N864	Alert: This claim is subject to the No Surprises Act provisions that apply to emergency services.
N865	Alert: This claim is subject to the No Surprises Act provisions that apply to nonemergency services furnished by nonparticipating providers during a patient visit to a participating facility.
N866	Alert: This claim is subject to the No surprises Act provision that apply to services furnished by nonparticipating providers of air ambulance services.

How cost sharing was calculated under the No Surprises Act

RARC #	RARC Text
N862	Alert: Member cost share is in compliance with the No Surprises Act and is calculated using the lesser of the QPA or billed charge.
N867	Alert: Cost sharing was calculated based on a specified state law, in accordance with the No Surprises Act.
N868	Alert: Cost sharing was calculated based on an All-Payer Model Agreement, in accordance with the No Surprises Act.
N869	Alert: Cost sharing was calculated based on the qualifying payment amount, in accordance with the No Surprises Act.
N870	Alert: In accordance with the No Surprises Act, cost sharing was based on the billed amount because the billed amount was lower than the qualifying payment amount.

Initial payment amount

RARC #	RARC Text
N871	Alert: This initial payment was calculated based on a specified state law, in accordance with the No Surprises Act.
N877	Alert: This initial payment is provided in accordance with the No Surprises Act. The provider or facility may initiate open negotiation if they desire to negotiate a higher out-of-network rate.

Final payment amount

RARC #	RARC Text
N863	Alert: This claim is subject to the No Surprises Act (NSA). The amount paid is the final out-of-network rate and was calculated based on an All-Payer Model Agreement, in accordance with the NSA.
N872	Alert: This final payment was calculated based on a specified state law, in accordance with the No Surprises Act.
N873	Alert: This final payment was calculated on an All-Payer Model Agreement, in accordance with the No Surprises Act.
N874	Alert: This final payment was determined through open negotiation, in accordance with the No Surprises Act.

Denial of Payment

RARC #	RARC Text
N876	Alert: This item or service is covered under the plan. This is a notice of denial of payment provided in accordance with the No Surprises Act. The provider or facility may initiate open negotiation if they desire to negotiate a higher out-of-network rate than the amount paid by the patient in cost sharing.

Notice and Consent

RARC #	RARC Text
N878	Alert: The provider or facility specified that notice was provided and consent to balance bill obtained but notice and consent was not provided and obtained in a manner consistent with applicable Federal law. Thus, cost sharing and the total amount paid have been calculated based on the requirements under the No Surprises Act, and balance billing is prohibited.
N879	Alert: The notice and consent to balance bill, and to be charged out-of-network cost sharing, that was obtained from the patient with regard to the billed services, is not permitted for these services. Thus, cost sharing and the total amount paid have been calculated based on the requirements under the No Surprises Act, and balance billing is prohibited.

Miscellaneous

RARC #	RARC Text
N830	Alert: The charge[s] for this service was processed in accordance with Federal/ State, Balance Billing/ No Surprise Billing regulations. As such, any amount identified with OA, CO, or PI cannot be collected from the member and may be considered provider liability or be billable to a subsequent payer. Any amount the provider collected over the identified PR amount must be refunded to the patient within applicable Federal/State timeframes. Payment amounts are eligible for dispute pursuant to any Federal/State documented appeal/grievance process(es).
N859	Alert: The Federal No Surprise Billing Act was applied to the processing of this claim. Payment amounts are eligible for dispute pursuant to any Federal documented appeal/ grievance/ dispute resolution process(es).

ParaRev can help

With almost 90% of consumers being surprised by either an unexpected medical bill or a bill that was more than expected¹, it’s important to understand and use the appropriate RARC Codes Related to the No Surprises Act.

Hospital resources are finite, and with the constantly evolving environment of healthcare, codes and billing requirements can be hard to manage. Under the ParaRev Coding and Compliance Department, the Data team serves as a relief valve to ensure that the changes we are proposing our implemented in a timely and accurate fashion.

With coding and billing requirements constantly changing, many organizations are overwhelmed with maintaining billing systems and find annual pricing updates also a challenge. ParaRev has the capability to assist the hospital in the implementation of updated CPT®/HCPCS codes and prices through our Data Maintenance Services. These services allow your hospital to easily maintain ongoing updates to your change master through remote access.

ParaRev also offers a full spectrum of healthcare revenue cycle management services, from front-end charge master analysis and contract management, to end-of-cycle zero-balance denial recovery. We’re committed to working seamlessly with your hospital financial and billing staff to minimize denials and bad debt, improve collections, and boost revenues.