CO 308 denial code

Claim adjustment reason code 308. Often reported as CO 308.

Funding terms in your contract applied

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 308 means

A pay arrangement written into your contract with this payer changed the amount, not a problem with the claim.

This is one of the newest codes on the list. It tells you the amount moved because of money terms you and the payer agreed to, not because of a billing or coding error.

Because the code is new, read any remark codes and line the amount up with the funding section of your agreement before you treat it as a variance.

Group codes seen with 308

On a remittance, 308 comes after a group code. These are the ones it is most often reported with:

• CO 308 (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 provider has a contracted funding arrangement with the payer.
• Payments under that arrangement are reconciled on individual claims.
• The contract shifts part of the payment to a separate funding mechanism.

What to do next

1. Identify which funding agreement in the contract applies to the claim.
2. Reconcile the adjustment against funding statements from the payer.
3. Ask the payer's provider relations team to explain amounts that do not tie to the agreement.

Related codes

• 139 (reason code) Employee funding agreement adjustment
• 45 (reason code) Charge exceeds the allowed amount