Quick Explanation
Denial code CO-87 indicates that the payer has determined the patient's transfer from one healthcare facility to another was not medically necessary or clinically appropriate. This typically occurs when the payer decides the transferring facility had the capability to manage the patient's condition, or the documentation fails to support the clinical need for specialized care at the receiving facility.
Common Causes for CO-87
Denials with code CO-87 typically happen for the following specific reasons:
- The transferring facility possessed the clinical resources, staff, and capabilities to treat the patient's condition, making the transfer medically unnecessary.
- Clinical documentation failed to justify the transfer, lacking evidence of patient deterioration or the need for tertiary-level specialized care.
- Incorrect patient discharge status codes (e.g., UB-04 Form Locator 17) were billed, conflicting with Medicare's Post-Acute Care Transfer Policy guidelines.
- Failure to obtain the required prior authorization or pre-certification from the commercial payer before executing a non-emergent transfer.
How to Prevent CO-87 Denials
To avoid receiving this denial in the future, implement these specific checks:
- Implement clinical decision support tools (such as InterQual or MCG criteria) to objectively verify and document that transfer criteria are met before transferring a patient.
- Ensure complete medical documentation is sent with the patient, explicitly detailing the specific specialized services or procedures required that the originating facility cannot provide.
- Conduct regular audits on discharge status codes to ensure alignment between the billing department and clinical discharge planners.
- Establish a robust pre-authorization protocol for all non-emergent facility-to-facility transfers to secure payer approval in advance.
Appeal Letter Template for CO-87
If you believe this claim was denied incorrectly, you can use the following template to submit an appeal.
[Your Practice Header]
[Date]
[Payer Name]
[Appeals Department Address]
RE: Appeal for Claim [Claim Number]
Patient: [Patient Name]
ID: [Patient ID]
Date of Service: [Date]
Denial Code: CO-87 - Transfer to other facility not appropriate
Dear Appeals Department,
I am writing to appeal the denial of the above-referenced claim, which was denied with code CO-87: "Transfer to other facility not appropriate".
We are appealing the denial of this claim associated with denial code CO-87 (Transfer to other facility not appropriate). The submitted medical records demonstrate that the transfer was clinically indicated and medically necessary under CMS guidelines and EMTALA regulations. The transferring facility lacked the specialized tertiary-level resources, specifically [Insert Specific Capability/Specialist, e.g., advanced interventional cardiac care], required to safely stabilize and treat the patient's acute condition. Prolonging care at the originating facility would have posed a severe risk to the patient's health. Therefore, the transfer met all medical necessity criteria for acute-to-acute transfer. We respectfully request that you review the attached clinical documentation and reverse this denial.
Attached please find:
1. A copy of the original claim.
2. The relevant medical records supporting the service.
3. [Any other supporting documents].
We respectfully request that you reprocess this claim for payment.
Sincerely,
[Your Name]
[Title]
[Practice Name]
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