CARC 38: Services Not Provided or Authorized by Designated Providers

What it means

This denial means the payer expected the service to come from, or be authorized by, a specific network provider or primary care provider (PCP), and that requirement wasn't met. It's common in HMO or managed care plans that require referrals or require care to be delivered in-network.

Common causes

Patient received care from an out-of-network provider without required authorization
No referral on file from the patient's designated PCP
Service rendered by a specialist without the required gatekeeper referral
Authorization was obtained but not linked to the correct provider or claim
Plan requires services to be coordinated through a specific network and that step was skipped

How to fix it

Confirm the patient's plan type (HMO, EPO, etc.) and whether PCP referral or network authorization was required
Check for an existing referral or authorization number and verify it matches the rendering provider and date of service
If a referral exists but wasn't submitted, resubmit the claim with the referral/authorization attached
If no referral was obtained, contact the PCP or network to request a retroactive referral where the plan allows it
Verify the rendering provider's network status with the payer before resubmitting
If the service was urgent/emergent, gather documentation supporting an exception to the referral requirement

Appeal / resubmit

When appealing, include documentation showing either a valid referral/authorization that was simply not on file at time of adjudication, or evidence the service met an emergency/urgent care exception that waives referral requirements. Clearly state the rendering provider's network relationship and attach the PCP's referral order if available.

Related codes

Frequently asked

Does this denial mean the patient owes the full bill?

Not necessarily. Billing staff should first verify whether a retroactive referral or authorization can be obtained, or whether the claim can be corrected and resubmitted, before determining patient responsibility.

Can this be fixed with a corrected claim?

Sometimes. If the needed referral or authorization number simply wasn't included on the original claim, adding it and resubmitting may resolve the denial.

What if the service was an emergency?

Many plans waive referral/authorization requirements for emergency care. Document the emergent nature of the visit and submit it with the appeal.

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This content is informational only and does not constitute billing or legal advice. Always verify requirements with the specific payer and consult qualified billing or legal professionals for your situation.