DENIAL CODE · CO-253

CO-253: Sequestration Reduction

CO-253 is the roughly 2% sequestration reduction on Medicare and Medicare Advantage payments. On those lines it's correct. It becomes recoverable money when a commercial payer takes it with no basis, or when it's double-applied.

Official (X12/WPC): "Sequestration - reduction in federal payment."

Why payers issue CO-253

Correct on Medicare/MA lines — a mandated 2% federal reduction
A commercial payer applied it with no contractual basis
The 2% was double-taken on the same payment
It was applied to a non-Medicare line

Is it recoverable? On Medicare it's not appealable. But a commercial payer applying sequestration — or a double-take — is a clean, recoverable error; check every 2% reduction that isn't on a government line.

Recover a Sequestration Over-Applied underpayment →

Common questions

What does CO-253 mean?

How do I appeal or fix a CO-253 denial?

On Medicare it's not appealable. But a commercial payer applying sequestration — or a double-take — is a clean, recoverable error; check every 2% reduction that isn't on a government line. Common causes: correct on Medicare/MA lines — a mandated 2% federal reduction; a commercial payer applied it with no contractual basis; the 2% was double-taken on the same payment; it was applied to a non-Medicare line.

Is a CO-253 denial worth appealing?

On Medicare it's not appealable. But a commercial payer applying sequestration — or a double-take — is a clean, recoverable error; check every 2% reduction that isn't on a government line. You only pay on what's actually recovered, so there's no cost to working the ones that are winnable.

Other denial codes

CO-197 · Precertification / Authorization Absent →CO-50 · Not Medically Necessary →CO-16 · Missing or Invalid Information →CO-45 · Charge Exceeds Fee Schedule →CO-97 · Bundled into Another Service →CO-29 · Timely Filing Expired →CO-96 · Non-Covered Charge →OA-18 · Duplicate Claim →OA-22 · Coordination of Benefits →CO-11 · Diagnosis Inconsistent with Procedure →CO-151 · Too Many Services (Frequency/MUE) →CO-B7 · Provider Not Eligible →CO-27 · Coverage Terminated →CO-204 · Not Covered Under Current Plan →CO-109 · Not Covered by This Payer →CO-119 · Benefit Maximum Reached →CO-4 · Modifier Inconsistent or Missing →CO-15 · Authorization Number Missing or Invalid →OA-23 · Prior Payer Adjudication Impact →CO-24 · Charges Covered Under Capitation →CO-26 · Expenses Incurred Prior to Coverage →CO-54 · Assistant Surgeon Not Covered →CO-55 · Experimental / Investigational →CO-58 · Inappropriate Place of Service →CO-59 · Multiple/Concurrent Procedure Reduction →CO-107 · Related/Qualifying Claim Not Identified →CO-167 · Diagnosis Not Covered →CO-170 · Denied for This Provider Type →CO-181 · Procedure Code Invalid on Date of Service →CO-182 · Procedure Modifier Invalid on Date of Service →CO-183 · Referring Provider Not Eligible to Refer →CO-185 · Rendering Provider Not Eligible →CO-198 · Precertification / Authorization Exceeded →CO-226 · Requested Provider Information Not Provided →CO-231 · Mutually Exclusive Procedures →CO-234 · Procedure Not Paid Separately →CO-236 · Procedure/Modifier Combination Not Compatible →CO-242 · Out-of-Network / Non-Network Provider →CO-252 · Documentation Required to Adjudicate →CO-256 · Not Payable Per Managed-Care Contract →CO-288 · Referral Absent →CO-B15 · Qualifying Service Not Received →CO-B16 · New Patient Qualifications Not Met →CO-A1 · Claim/Service Denied (Remark Required) →

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