Thanks for the question.
A three-way catalytic converter (TWC) controls exhaust emissions of hydrocarbons (HC), carbon monoxide (CO), and oxides of nitrogen (NOx). The catalyst within the converter promotes a chemical reaction which oxidizes the HC and the CO that is present in the exhaust gas. This process will convert the HC and the CO into water vapor and carbon dioxide (CO2), and will reduce the NOx, converting the NOx into nitrogen. The catalytic converter also stores oxygen. The engine control module (ECM) monitors this process by using a heated oxygen sensor (HO2S) which is in the exhaust stream past the TWC. The HO2S produces an output signal which indicates the oxygen storage capacity of the catalyst. This in turn indicates the catalysts ability to convert the exhaust emissions effectively. The ECM monitors the catalyst efficiency by first allowing the catalyst to heat, then waiting for a stabilization period while the engine is idling. Then, the ECM adds and removes fuel while monitoring the reaction of the HO2S. When the catalyst is functioning properly, the HO2S 2 response to the extra fuel is slow compared to the HO2S 1. When the HO2S 2 response is close to that of the HO2S 1, the oxygen storage capability or efficiency of the catalyst may be degraded below an acceptable threshold. If the ECM detects the degraded condition DTC P0420 sets.
Basically, the catalyic converter has failed and needs to be replaced.
If you have any questions, please let me know.