Other Coverage Code Guidance

Colorado Medicaid – Pharmacy Billing Other Coverage Code (OCC) Guidance

Coordination of Benefits (COB) and Third-Party Liability (TPL) expectations

• Medicaid is the payer of last resort, bill the member’s primary insurance before billing Medicaid.
• The Pharmacy Benefit Management System (PBMS) uses commercial insurance data to identify primary coverage and enforce secondary billing.
• Members must use in-network pharmacies for their plan and follow the primary plan formulary.
• If a member disputes reported primary coverage, direct them to the Member Contact Center.
• If all primary steps were followed and the claim still rejects, contact the PBMS Help Desk for assistance, see under Pharmacy Support on the HCPF provider webpage Provider Contacts.

Colorado Medicaid OCC codes (field 308-C8)

Notes

• Claims submitted with Other Coverage Codes (OCC) outside of the approved list (0, 1, 2, 3, or 4) will be denied.
• It is critical to choose the single OCC code that best reflects the billing circumstances for each claim.
• The distinction between Code 2 and Code 4 is crucial:
  • OCC 2 indicates that payment was collected from another payer, and this payment information must be included in the COB fields.
  • OCC 4 indicates that another payer processed the claim, but no payment was collected, as it was applied to the patient's deductible or copay responsibility.
• An incorrect OCC selection can directly impact claim reimbursement.
   

Other Coverage Code 1 (No other coverage identified)

Use when the member has no other active insurance coverage.

OCC 1 Required NCPDP Fields:

Notes OCC 1

• Use only when no active coverage exists, Medicaid is primary. 
   

OCC 1 Examples:

Example 1

Example 2

Other Coverage Code 2 (Other coverage exists, payment collected)

Submit when another payer paid a positive amount and Medicaid is being billed as secondary.

OCC 2 Required NCPDP Fields:

Notes OCC 2

• OCC 2 is used when the other payer made a payment, even if that payment fully covered the claim (resulting in a $0 patient responsibility).
• Always populate patient-responsibility fields 351-NP, 352-NQ, 353-NR; do not leave them blank.
• Use the values returned by the other payer.
• If the other payer shows a patient portion greater than zero, enter that amount.
• If the other payer shows zero, still populate the fields and enter 0.00 in 352-NQ, must not be left blank.
• 352-NQ, Other Payer Patient Responsibility Amount, enter the patient cost share returned by the other payer at adjudication, use 0.00 or greater.
• If no payment was made and the amount was applied to deductible, copay, or coinsurance, use OCC 4 instead.
   

OCC 2 Examples:

Example 1

Example 2

Other Coverage Code 3 (Other coverage exists, claim not covered)

Submit when another payer denied the claim and did not make any payment.

OCC 3 Required NCPDP Fields:

Notes OCC 3

• Use OCC 3 only when another payer denied the claim and made no payment.
• Do not include payment or patient-responsibility fields; leave them blank.
• Include a valid reject code (472-6E) and reject-count (471-5E).

Medicaid Prior Authorization requirements still apply when applicable, OCC 3 does not waive PA requirements, and COB field submission does not replace PA.  

If a primary payer prior authorization was submitted and denied, and the appeal was also denied, and the claim still rejects after all primary steps, contact the PBMS Help Desk for assistance, see under Pharmacy Support on the HCPF provider webpage Provider Contacts.
 

OCC 3 Examples:

Example 1

Example 2

Example 3

Other Coverage Code 4 (Other coverage exists, payment not collected)

Submit when another payer processed the claim, no payment was made, the cost was applied to deductible, copay, or coinsurance.

OCC 4 Required NCPDP Fields:

Notes OCC 4

• Populate patient responsibility fields 351-NP, 352-NQ, 353-NR, for OCC 4 the 352 NQ amount must be greater than 0.00.
• Enter values exactly as returned by the other payer’s claim response.
• Enter 0.00 in 431-DV, Other Payer Amount Paid.
• Because 431-DV is present, 342-HC, Other Payer Amount Paid Qualifier, is required, and 341-HB, Other Payer Amount Paid Count, is required.
• 443-E8, Other Payer Date, 339-6C, Other Payer ID Qualifier, and 340-7C, Other Payer ID, are required.
• Payment information must be included in the COB fields (for example 431-DV = 0.00, 342-HC, 341-HB, 351-NP, 352-NQ, 
  353-NR), otherwise the claim may reject.
• If the primary shows 0.00 patient responsibility, do not use OCC 4. Use OCC 2 and include a positive 431-DV.
• If both 431-DV and 352-NQ are 0.00, the claim will reject. Update the amounts to match the primary and resubmit with the correct OCC value.

Effective, 10/15/2025, all Medicaid Prior Authorization requirements apply, this does not change COB field submission. OCC 4 does not waive PA requirements, and COB field submission does not replace PA.
 

OCC 4 Examples:

Example 1

Example 2

Example 3