CO-24 Denial Code: Capitation Agreement Charges Explained

The CO-24 denial code means the charges are covered under a capitation agreement or managed care plan, so the fee-for-service payer you billed will not pay them. Under capitation, a provider or group receives a fixed per-member payment regardless of services rendered, and a claim submitted to the wrong entity for a capitated member comes back as CO-24. It is rarely an appeal — it is almost always a routing correction.

What is the CO-24 denial code? CO-24 is a Claim Adjustment Reason Code (CARC) indicating that the charges are covered under a capitation agreement or managed care plan, meaning the billed payer is not responsible for paying the service fee-for-service.

Undeny's Take

CO-24 is a map problem, not a money problem. The service was covered; you just sent the claim to the wrong place. The recurring cause is a member whose benefits are administered through a capitated IPA, medical group, or managed-care entity, while your system still has the parent payer on file. Chasing a CO-24 with an appeal wastes time — the fee-for-service payer is correct that it owes nothing. The fast resolution is to verify which entity holds the capitation for that member and redirect the claim there. Fix the routing once for that plan, and the denials stop recurring.

What CO-24 Is Telling You

CO-24 says the patient's coverage operates under a capitation or managed-care arrangement for this service, so the payer you billed is not the one responsible for the fee. Because it sits in the Contractual Obligation (CO) group, the amount is not billable to the patient — it reflects the contractual structure of how the service is funded, not a patient balance.

Why a Capitated Claim Lands Here

The member's benefits are administered by a capitated medical group or IPA, not the payer billed.
The patient enrolled in a managed-care plan and your records still show the prior fee-for-service payer.
The service falls under a carve-out or sub-capitated arrangement with a different entity.
A Medicare or Medicaid managed-care plan, not original Medicare/Medicaid, is responsible.

Routing and Correcting a CO-24

Verify the member's current plan and which entity holds the capitation for the service.
Update the payer and plan information on file to the responsible capitated entity.
Submit the claim to that entity following its filing rules, or post the adjustment if your group is the capitated provider already paid per member.
If you believe the service should have paid fee-for-service, document the coverage and dispute it with the appeal generator.

Adjacent Denial Codes

CO-24 keeps company with CO-22 (coordination of benefits — another payer is primary) and CO-109 (claim not covered by this payer/contractor). Browse the full set under denial codes.

Frequently Asked Questions

What does CO-24 mean?

CO-24 means the charges are covered under a capitation agreement or managed care plan, so the payer you billed is not responsible for paying them fee-for-service. The claim usually needs to go to the capitated entity instead.

Can I bill the patient for a CO-24 amount?

No. CO-24 carries the Contractual Obligation group, so the amount reflects how the service is funded under a capitation arrangement and is not patient responsibility. The fix is correcting where the claim is sent, not billing the patient.

Why did a capitated claim deny with CO-24?

The most common reason is that the member's benefits are administered by a capitated group, IPA, or managed-care plan while your records still list a fee-for-service payer. Verify the current plan and route the claim to the responsible entity.

Is CO-24 worth appealing?

Usually not, because the billed payer is correct that it owes nothing under the capitation. Appeal only if you can document that the service should have been paid fee-for-service; otherwise, redirect the claim to the capitated entity.

Informational only — not legal, medical, or billing advice. Always verify against current payer policy and the member's plan.

Resolve CO-24 denials faster

Undeny identifies the responsible payer and drafts the correction in seconds. Generate an appeal · Browse denial codes