CARC 45: Charge Exceeds Fee Schedule/Maximum Allowable Amount

What it means

The amount billed for this service is higher than what the payer's fee schedule, contract, or legislated rate allows. The payer is adjusting the claim down to the allowed amount, and the difference between what was charged and what's allowed is being written off (if you're in-network) or may be billable to the patient depending on your contract and applicable law.

Common causes

Billed charge is higher than the negotiated contract rate with the payer
Fee schedule was updated and the provider's charge master wasn't adjusted to reflect new rates
Out-of-network claim where payer applies its own maximum allowable rate instead of billed charge
State or federal fee schedule (e.g., Medicare, workers' comp) caps reimbursement below billed amount
Incorrect or outdated contract rate loaded into the practice management system

How to fix it

Review the remittance advice to confirm the allowed amount matches your current payer contract or fee schedule
Compare the allowed amount against your most recent fee schedule from the payer or applicable regulatory source
If allowed amount appears incorrect, contact the payer with documentation of your contracted rate for review
Write off the contractual adjustment per your agreement if the allowed amount is correct
Verify your charge master and fee schedule entries are current to prevent recurring adjustments
Do not bill the patient for the difference unless your contract and applicable law permit balance billing

Appeal / resubmit

This is typically a contractual adjustment, not a true denial, so appeals are uncommon unless you believe the payer misapplied the fee schedule or used an outdated contract rate. If disputing, submit a copy of your current signed contract or the applicable fee schedule effective for the date of service, along with the claim and remittance advice, and request a reprocessing review from the payer's provider relations department.

Related codes

Frequently asked

Can I bill the patient for the difference between my charge and the allowed amount?

Generally no, if you're in-network, your contract usually prohibits balance billing beyond copays, coinsurance, or deductibles. Check your specific payer agreement and applicable state/federal rules before billing a patient.

Is CARC 45 an error I need to fix and resubmit?

Not usually. It most often reflects a standard contractual adjustment. Resubmission is only needed if you find the allowed amount was calculated incorrectly.

Why does my allowed amount keep decreasing with this code?

Fee schedules and contracts are updated periodically. Check that your billing system reflects the most current rates for each payer.

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This content is informational only and not billing or legal advice. Verify all denial handling with current payer policies and a qualified compliance professional.