Quick Explanation
Denial code 27 (CO-27 or PR-27) indicates that healthcare services were billed after a patient's insurance coverage had already terminated, making the claim ineligible for insurance payment.[1][2] The critical distinction is that CO-27 represents a contractual obligation denial where the provider cannot bill the patient per payer agreements, while PR-27 shifts responsibility to the patient when coverage has expired.[3] This denial reflects a timing mismatch between the service date and the active coverage period, not a coding or documentation deficiency.
Common Causes for 27
Denials with code 27 typically happen for the following specific reasons:
- Failure to verify current insurance coverage status at the time of service or immediately before claim submission, resulting in billing against an already-terminated policy.[1][4]
- Delayed claim submission beyond the patient's coverage termination date due to internal processing backlogs, administrative delays, or failure to establish submission deadlines.[4][5]
- Outdated or incorrect insurance information maintained in patient records, including failure to update termination dates or capture mid-year plan changes without provider notification.[4][6]
- Errors in recording the insurance coverage termination date in the patient's electronic health record, creating a false impression of active coverage at time of service.[5]
- Lack of patient communication regarding coverage changes, such as when patients switch insurance plans or experience coverage lapses without notifying the provider.[5][6]
How to Prevent 27 Denials
To avoid receiving this denial in the future, implement these specific checks:
- Implement real-time automated insurance verification systems that check active coverage status immediately before service delivery, not relying on information from previous visits or manual verification.[6]
- Establish and enforce strict internal claim submission deadlines (e.g., submit within 5-7 business days of service) with automated tracking mechanisms to flag claims approaching submission cutoff dates.[6]
- Conduct mandatory insurance verification updates at every patient encounter, documenting the verification date and method, and require staff to confirm coverage termination dates match payer records.[6]
- Create a pre-claim quality assurance checkpoint that cross-references the service date against the coverage termination date in the patient record before claim submission, with escalation protocols for discrepancies.[6]
- Establish proactive patient communication protocols requiring patients to notify the office of any coverage changes, and implement a system to flag accounts with upcoming or recent termination dates for verification before billing.
Appeal Letter Template for 27
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: 27 - Expenses After Coverage
Dear Appeals Department,
I am writing to appeal the denial of the above-referenced claim, which was denied with code 27: "Expenses After Coverage".
This claim should be reconsidered for payment based on the following: The service was rendered in good faith while the patient maintained active coverage at the time of encounter, as documented by [specific verification method and date]. The claim submission delay resulted from [internal processing/documentation compilation], not from intentional billing after coverage termination. Additionally, [if applicable: the patient's coverage termination date was not clearly communicated to the provider/the payer's records show coverage was active on the service date/the patient failed to notify the provider of coverage changes]. Per the principle of prompt payment and the provider's obligation to bill promptly upon service delivery, the claim should be processed based on the coverage status at time of service, not at time of claim submission. We respectfully request reconsideration and payment of this claim with supporting documentation of the active coverage verification performed at the time of service.
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]
Stop Writing Appeals Manually
Clausea can read your medical records and generate custom, evidence-based appeals for denial code 27 in seconds.
Generate Appeal for 27 Now