Roughly 65% of denied claims are never reworked at all. For the ones that are, the rework usually treats the symptom. Below are the five codes we see doing the most damage in physical therapy billing — what each one actually means, and the upstream break that causes it.
CO-197 — Precertification / prior authorization absent
The visit happened without a required authorization, or the auth on file didn't cover the date, units, or procedure billed. In PT this is usually a tracking failure, not a clinical one: auths expire mid-plan-of-care, visit counts drift past the authorized number, or a re-evaluation triggers a new auth requirement nobody flagged. The fix is a live auth ledger — authorized visits, used visits, and expiry dates visible before the patient is scheduled, not after the denial arrives.
CO-27 / eligibility denials — Coverage terminated or inactive
Eligibility errors are the single largest denial category — 56% of denials start with an eligibility problem, before the patient is even seen. Coverage lapses, plan changes at open enrollment, visit limits already exhausted at another clinic. A real-time eligibility check at scheduling and again at check-in kills most of these. Checking once, at intake, is not enough for a 12-visit plan of care.
CO-16 — Claim lacks information or has submission errors
The payer's catch-all: missing referring provider, absent notes, incomplete modifiers. In PT it often traces back to documentation that doesn't support the timed codes billed — the note exists, but the total treatment time or the one-on-one time isn't recorded in a way the claim can prove. This is where the 8-minute rule quietly turns into denials: units billed that the documented minutes don't support.
CO-97 — Payment included in another service (bundling)
The payer decided the procedure is part of another service already paid. Manual therapy, therapeutic activities, and evaluation codes billed in combinations a specific payer bundles will deny every single time — until someone maps that payer's bundling rules and changes how the combination is billed or documented. If CO-97 clusters around one payer, it is a rule you can learn once and stop paying for.
CO-29 — Timely filing limit expired
The most painful code on this list, because the work was done, the claim was clean — and it is usually unrecoverable. CO-29 rarely means someone filed late once. It means denied claims sat unworked past the appeal or corrected-claim window, or a secondary claim never went out. An aging-denial queue with deadlines attached is the entire fix.
Read the pattern, not the claim
One CO-197 is an accident. Forty CO-197s from one payer in 90 days is a process failure with a dollar figure attached. The clinics that recover the most revenue don't work denials harder — they group them by code, payer, and location, find the two or three root causes producing most of the volume, and fix those at the source.
That grouping is exactly what a denial audit does: your last 90 days of claims, classified by CARC code and payer, with the recoverable dollars separated from the truly lost ones.