CMS Implements CARC and RARC Updates

The Centers for Medicare and Medicaid Services (CMS) implemented updates to Claim Adjustment Reason Code (CARC) and Remittance Advice Remark Code (RARC) lists on October 7, 2013. Per Medicare policy, CARCs and RARCs that provide either supplemental explanation for a payment adjustment or policy information that generally applies to the payment adjustment are required in the remittance advice (835 or paper remittance) and coordination of benefits transactions (837). CARC and RARC code sets are updated three times a year.

CARC updates include nine new codes (e.g., 253 – Sequestration – reduction in federal spending), modified narrative on twenty-four codes, and one deactivated code (125 – Submission/billing error) effective 11/1/2013. RARC updates include 103 new codes (e.g., N642 – Adjusted when billed as individual tests instead of as a panel) and modified narrative on four codes. There were no deactivated RARC codes.

Additional information regarding CARC and RARC updates is available in MLN Matters article #8422 ( A complete list of CARC and RARC code sets is available on the Washington Publishing Company (WPC) website at

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