835 Payment with Negotiated Discount

This an example of the 835/payment transaction from X12.org:

In this example the provider and payer came to an agreed upon amount for allowance for these specific services billed which happened to be less than billed charges. The difference between the billed charge and the negotiated amount is shown as an adjustment in a CAS segment. The claim adjustment reason code would be 131 “Claim specific negotiated discount”. Group code CO (contractual obligation) would be used as the adjustment amount is provider liability in this example.