What to Do When Your Claim Is Denied With Code CO-197 (Preauthorization Required)
How to Fix a Preauthorization Denial and Win Your Appeal
Insurance companies are increasingly using CO-197 to deny claims, even when:
Your provider did request preauthorization
The insurer mishandled the request
The service should not have required prior auth
The procedure was urgent or emergent
The insurer applied the wrong medical policy
This denial code is extremely common — and often wrong.
In fact:
CO-197 is one of the easiest denial codes to overturn when you understand the rules and submit a strong appeal.
This guide explains:
What CO-197 means
When insurers are allowed to use it
When the denial is invalid
How to find out if your provider requested authorization
What evidence you need
How to write a powerful appeal letter
When insurers violate federal law
How to escalate if needed
Let’s break it down clearly and in plain English.
1. What Does CO-197 Mean?
CO-197 = The service was denied because the insurer says it required preauthorization.
This means the planner believes you or your provider did not get approval before receiving the service.
Common services requiring prior authorization:
MRI / CT / PET scans
New or expensive medications
Out-of-network care
Surgeries
Mental health services
Durable medical equipment
Physical therapy sessions
Hospital admissions
Genetic testing
Infusions and injections
But here’s the important part:
Insurers frequently deny care as “preauthorization required” even when the provider DID request it.
Administrative errors are common.
2. Why Insurance Companies Deny Claims With CO-197
✔ Reason 1: Provider Never Requested Authorization
Sometimes the provider simply didn’t know prior auth was required.
✔ Reason 2: Provider Requested Preauthorization — but Insurer Lost It
This happens constantly:
Submission stuck in portal
Fax not processed
Wrong diagnosis code used
Wrong CPT code used
Representative gave bad instructions
If the provider can show proof they attempted authorization, you may win instantly.
✔ Reason 3: Wrong CPT or Diagnosis Code Submitted
If your doctor requested authorization for one code but billed another, the insurer may deny with CO-197.
This is often fixable with:
A corrected claim, or
A provider letter
✔ Reason 4: Insurer Applied the Wrong Medical Policy
Example:
Insurer claims MRI requires authorization
Your plan actually exempts certain MRIs
Insurer used general guidelines, not your specific plan
This is a frequent insurer error.
✔ Reason 5: Emergency or Urgent Care Received
Under federal law and state laws:
Emergency services cannot require preauthorization.
If the service was emergent, insurers cannot use CO-197 to deny it.
✔ Reason 6: Insurer Error
Yes — insurers regularly approve services, but the system never updates.
Claim auto-denies under CO-197.
Appeals commonly fix this.
3. First Step: Read the Denial Letter Carefully
The EOB only gives you CO-197, but the denial letter gives:
Exact reason
Policy sections
Preauthorization rules
What codes the insurer reviewed
Whether it was “clinical” or “administrative” denial
Appeal address
Your deadlines
Your right to submit more evidence
Look for these clues:
“Authorization was not submitted.”
“Service requires prior approval under policy section…”
“Code mismatch.”
“Provider used incorrect NPI.”
“Emergency care excluded from prior auth requirements.”
“Partial authorization on file.”
These details determine your next steps.
4. Determine Whether You Need a Corrected Claim or an Appeal
✔ Submit a Corrected Claim if:
Wrong CPT code submitted
Wrong diagnosis code submitted
Modifier missing
Provider billed under wrong NPI
Provider did request prior auth but used mismatched codes
Authorization number exists but is not linked
This is NOT a patient appeal issue.
Your provider must fix it.
✔ File an Appeal if:
Insurer incorrectly claims the service required prior authorization
The service was emergent or urgent
Preauthorization was requested but insurer claims it wasn’t
Insurer applied the wrong medical policy
You were unable to obtain authorization due to insurer delay
Provider was told no auth was needed
You were out-of-network for medically necessary reasons
This is a patient appeal issue.
5. How to Write a CO-197 Appeal (Step-by-Step)
Here is the structure insurers expect.
1. Identify the Claim
Include:
Patient name
Member ID
Claim number
Date of service
Denial code (CO-197)
Provider name
2. State Why the Denial Is Wrong
A powerful opening example:
“I am appealing the CO-197 denial because this service was covered under my plan and did not require preauthorization under the circumstances.”
3. Quote Your Plan Language
Request your Evidence of Coverage (EOC) or Summary Plan Description (SPD).
Quote:
Preauthorization rules
Emergency/urgent care exemptions
Coverage requirements
Then explain how your case meets them.
4. Provide the Factual Timeline
Examples:
Provider requested authorization on [date]
Insurer delayed processing
Incorrect info was given by insurer
Service was emergent
Insurer has similar services preapproved in past
Insurers need a clear timeline to overturn denials.
5. Attach Supporting Evidence
This is essential.
Include:
Provider letter
Screenshots from authorization portal
Fax confirmation
Call logs documenting insurer instructions
Medical records showing urgency
Policy pages showing coverage
Any prior approval numbers
6. Make a Legal Request for Reconsideration
Use strong language:
“Please conduct a full, fair, and thorough review consistent with ERISA, the ACA standards for emergency services, and state prior authorization laws.”
👉 Get Your $29 Preauthorization Appeal Template (CO-197)
6. Appeal Deadlines (Critical)
Your timeline depends on your plan type.
ERISA Employer Plans
60-180 days to appeal
Insurer must respond in 30–60 days
You have full right to see your claim file
Marketplace & Individual Plans
60–120 days
External review available
Medicare / Medicaid
Different deadlines apply, but prior auth denials are appealable.
7. When You Can Demand an External Review
You have the right to an Independent Review Organization (IRO) when:
Insurer applied the wrong policy
Service was emergent
Insurer failed to process preauthorization
Plan misrepresented requirements
Insurer delayed authorization request
IRO reviewers overturn CO-197 denials all the time.
8. CO-197 Denials Are Win-able — If You Submit a Complete Appeal
Preauthorization denials can feel frustrating, but the good news is:
Most CO-197 denials are reversed once the insurer sees the correct documentation.
Insurers count on patients giving up.
A strong appeal forces them to reconsider the denial fully and legally.
Denied With CO-197? Use the Attorney-Drafted Appeal Letter for Preauthorization Denials.
Writing a preauthorization appeal from scratch is stressful — especially when insurers rely on technicalities to deny your claim. My Preauthorization Appeal Template is written specifically for CO-197 denials and includes:
✔ Attorney-drafted appeal letter
✔ What evidence to attach
✔ Policy + legal arguments insurers respond to
✔ Step-by-step filing instructions
✔ Instant download
👉 Get the Preauthorization Appeal Template (CO-197)
You CAN Win Your Appeal
A denial letter is not the final decision. Insurance companies overturn claims every day when people submit a strong appeal.
Whether you use:
➡ The Free Appeal Guide
or
➡ The $29 Professional Appeal Template
—you can absolutely take back control and fight your denied claim with confidence.
Download Your Free Appeal Guide
Get the step-by-step instructions, evidence checklist, and sample wording you need.
Download Free Guide
Need a Full Appeal Letter Template? ($29)
Get a professionally drafted, fill-in-the-blank appeal letter tailored for medical claim denials.
Get the Full Template
