OA-132: Prearranged Demonstration Project Adjustment

What Does OA-132 Mean?

OA-132 applies the demonstration project adjustment as an informational notification rather than a standard contractual write-off. This may occur when the adjustment is being communicated across payers or when the demonstration project's payment impact is being reflected outside the primary Medicare claim processing.

CARC 132 appears when a claim is adjusted due to the provider's participation in a CMS-approved demonstration project or alternative payment model. These programs — including ACO REACH, Direct Contracting, bundled payment initiatives, and other Medicare innovation models — use modified payment methodologies that differ from standard fee-for-service reimbursement. The adjustment reflects the payment difference between the standard Medicare rate and the demonstration-specific rate.

This code is specific to Medicare and its alternative payment programs. Providers who have signed agreements to participate in demonstration projects should expect CARC 132 adjustments as a routine part of their remittances. The adjustment amount varies depending on the specific program and its payment formula, but it is always a contractual obligation — the provider agreed to the modified payment terms by enrolling in the program.

Providers who receive CARC 132 unexpectedly should verify their enrollment status. In some cases, a facility or provider may have been enrolled in a demonstration project without full awareness of its impact on claims, particularly when organizational agreements (such as an ACO's participation) affect individual provider claims. The accompanying RARC N763 is a strong indicator that the demonstration code applied to the service may be incorrect, warranting a review with the program administrator.

How to Resolve

Verify demonstration project enrollment, confirm the adjustment is correct, and write off as a contractual obligation.

1. Review the adjustment context Determine why the demonstration project adjustment was applied with OA instead of CO and whether it affects the net payment.
2. Contact the payer for clarification If the OA designation is unexpected, contact Medicare or the demonstration program administrator for guidance.

How to Prevent OA-132

• Track demonstration project adjustments across all remittances to ensure consistent application

Also Filed As

The same CARC 132 may appear with different Group Codes:

Related Denial Codes