Among large insurers reporting HealthCare.gov Marketplace data for 2024, Oscar Health had the highest average in-network claim denial rate at 25%. However, this does not mean Oscar denies the most claims across all U.S. health insurance. Denial rates vary by insurer, state, plan, network status, and claim type, so practices should focus on the reasons behind denials.
For practices working with The Medicator’s medical billing services, understanding recurring denial patterns can be more useful than relying on a payer ranking.
Common Reasons Medical Claims Are Denied
The most frequent problems generally fall into a few categories:
- Administrative errors: Incorrect patient, provider, claim, or billing information.
- Medical coding problems: CPT, ICD-10, modifier, unit, or diagnosis-to-procedure errors.
- Eligibility issues: Coverage was inactive or the service was not covered under the patient’s plan.
- Prior authorization or referral: Required approval was missing or did not match the service performed.
- Excluded services: The treatment falls outside the patient’s covered benefits.
- Medical necessity: Documentation does not satisfy the payer’s coverage criteria.
- Timely filing: The claim or required follow-up was submitted after the payer’s deadline.
KFF’s analysis of 2024 HealthCare.gov data found that administrative reasons accounted for 25% of reported in-network denial reasons, while 13% were for excluded services, 9% for missing prior authorization or referral, and 5% for medical necessity.
What Should a Practice Do When Denials Increase?
Don’t automatically blame the payer or repeatedly resubmit the same claim. First identify the denial code, determine whether the problem is correctable or appealable, and trace it back to the relevant workflow.
Example: Specialty Billing
A pain management practice receives repeated denials for a procedure because prior authorization was not documented. The billing team should verify the payer requirement, check the authorization record, correct the workflow if necessary, and appeal eligible claims with supporting documentation.
The Medicator’s revenue cycle management services can help practices monitor denial trends, strengthen claim scrubbing, manage appeals, and follow aging A/R.
Practical takeaway: Review denials by payer, CPT category, specialty, and reason code. That analysis can reveal whether the real problem is coding, eligibility verification, authorization, documentation, or payer processing.
