CO 118 denial code

Claim adjustment reason code 118. Often reported as CO 118.

ESRD network support adjustment

Unofficial reference. This is our own plain-English explanation, not the official code text. Payer rules differ. Verify with the payer and the official X12 code list. AlphaPrefix is not affiliated with X12, CMS or any payer. Data last updated Nov 11, 2026.

What 118 means

A small amount was taken from a dialysis payment to fund end-stage renal disease network activities.

Dialysis payments under some programs carry a set deduction that funds the regional networks that oversee end-stage renal disease care. This code reports that deduction.

It applies across claims and is not a denial. Post it as a routine adjustment.

Group codes seen with 118

On a remittance, 118 comes after a group code. These are the ones it is most often reported with:

• CO 118 (Contractual Obligation): The provider's side of the ledger. The reduction comes from the payer contract or a rule the provider has to follow, and the patient normally cannot be billed for it.

The payer chooses the group code for each adjustment, so the same reason code can appear with another group code on your remittance. Read the two together. More about group codes.

Common causes

• The claim is for dialysis services paid under a program that funds ESRD networks.
• The payer applied the standard network fee to each treatment.
• A rate update changed the deduction amount.

What to do next

1. Confirm the deduction matches the expected per-treatment rate.
2. Post it as a routine adjustment rather than working it as a denial.
3. Set up an automatic posting rule if your system supports it.

Related codes

• 45 (reason code) Charge exceeds the allowed amount