Understanding healthcare declare denials: Causes and options

Key takeaways:

• The primary purpose for medical declare denials stays unchanged in 2025, with lacking or inaccurate declare knowledge nonetheless topping the checklist — however worsening since 2024.
• AI-powered instruments like Patient Access Curator™ and AI Advantage™ may also help healthcare suppliers enhance declare denial charges and optimize the claims administration course of.
• 67% of providers imagine AI can enhance the claims course of, however solely 14% report utilizing AI to assist cut back denials.

Experian Health’s State of Claims 2025 survey reveals {that a} worrying development in healthcare declare denials continues — and is worsening. Greater than 40% of providers report that not less than one in ten claims are denied, an 11% uptick since 2022.

Denials at this scale are pushed by quite a few elements — a lot of which haven’t modified since 2024. This industry-wide, ongoing, and unchecked claims denial spiral represents billions of {dollars} in misplaced or delayed reimbursements, leaving income cycle leaders feeling mounting monetary stress to grasp what’s behind the rising charges and deal with them earlier than it’s too late.

This text explores the highest causes for declare denials, and the way automation and AI may also help organizations overcome operational roadblocks to cut back denial charges, streamline efficiencies and enhance money movement.

High causes for healthcare declare denials

Experian Well being surveyed 250 healthcare revenue cycle leaders to seek out out what’s behind the rising declare denial charges. Whereas the highest drivers for denials stay the identical in 2025 as 2024, the odds have shifted barely, with some suppliers reporting that issues are getting worse, not higher.

The highest causes for healthcare declare denials embrace lacking or inaccurate claims knowledge, authorizations, incomplete or incorrect affected person registration knowledge and code inaccuracy.

Lacking or inaccurate claims knowledge

In 2025, 50% of the State of Claims respondents report that lacking or inaccurate declare knowledge is the primary issue contributing to rising denial charges — up 4% from 2024. Clear claims submissions depend on getting the information proper the primary time. Nonetheless, 54% of respondents say that claims errors are on the rise. And almost 70% report that submitting clear claims is now more difficult than it was in 2024.

Inaccurate or incomplete affected person knowledge

Even the slightest mistake or mismatch in a affected person’s identify, deal with or insurance coverage particulars may end up in a denial, resulting in fee delays and further work for the workers. In 2025, greater than 1 / 4 of respondents say that at least 10% of denials outcome from inaccurate or incomplete knowledge collected at affected person consumption. These errors typically happen throughout registration, when vital affected person info is first collected and entered.

Prior authorizations

Prior authorization issues proceed to rank as a prime operational problem that triggers declare denials. Though barely down from the earlier yr, 35% of survey respondents nonetheless determine authorizations as a main set off. Not solely is the prior authorization course of advanced, nevertheless it’s additionally expensive and time-consuming for a lot of organizations to navigate efficiently. In line with the 2024 AMA Prior Authorization Physician Survey, physicians and their workers spend 13 hours per week finishing prior authorizations – with almost 90% reporting burnout.

Implementing expertise to forestall declare denials

Leveraging technology-driven solutions may also help organizations cut back declare denial charges, streamline operations and enhance money movement. Right here’s a better take a look at a number of methods suppliers can undertake to assist forestall declare denials and cut back expensive reworks.

Tighten up affected person entry processes

Amassing correct and full knowledge helps curb denials. Instruments like Experian Health’s Patient Access Curator (PAC) enable suppliers to make sure correct knowledge is used at each step of the affected person journey — with minimal handbook intervention. Powered by AI and machine studying, PAC consolidates eligibility checks, coordination of advantages, Medicare Beneficiary Identifier (MBI) verification, demographics, insurance coverage protection and monetary standing right into a single workflow.

With an built-in affected person entry resolution in place, like Patient Access Curator, suppliers can shortly acquire affected person info upfront and eradicate the necessity to rerun eligibility checks. The outcome? Workers have extra time for higher-value duties, handbook knowledge entry errors decline and declare submissions are cleaner.

Modernize claims administration

Legacy claims administration processes are sometimes tedious, disjointed and error-prone. Simply over 80% of providers say their group nonetheless depends on a number of options to gather info for claims submissions — a lot of which nonetheless require human intervention.

Instruments comparable to Experian Health’s Claim Scrubber assist suppliers put together error-free claims for processing by reviewing every line of the declare earlier than it’s submitted. For denials, an answer like Denial Workflow Manager allows organizations to trace declare standing and appeals so as to shortly prioritize claims that require follow-up.

Suppliers trying to modernize the complete claims cycle have the choice to implement an answer that automates claims processing, like ClaimSource®, whereas present ClaimSource customers can leverage AI Advantage to optimize the complete claims administration course of and higher predict and stop denials.

Lean into automation and AI

Income cycle leaders perceive that AI has its advantages, with almost 70% of providers saying they imagine AI can enhance the claims course of. Nonetheless, only 14% of organizations currently use AI to cut back denials. This reveals that there could also be some hesitancy round adopting new technology-based options.

For suppliers looking for to cut back denial charges and stop future denials, leveraging expertise, like AI, might present a roadmap ahead. Of the 14% who mentioned their group is at present utilizing AI, 69% report that it has reduced claim denial rates and/or elevated the success of resubmissions.

Discover how Experian Well being is reshaping the best way well being programs handle Coordination of Advantages. Find out how automation and AI are eliminating handbook errors, lowering denials and unlocking tens of millions in recoverable income.

The way forward for claims administration

As healthcare organizations proceed to face slender working margins and more and more advanced payer necessities, the monetary stress of climbing declare denial charges is prime of thoughts. Happily, AI-powered options and clever automation may also help suppliers deal with prime claims administration challenges head-on. With AI-powered instruments in place, like Experian Well being’s Patient Access Curator and AI Advantage, healthcare organizations can reduce denial charges, whereas bolstering monetary stability and enhancing affected person experiences.

Find out how Experian Well being’s AI-powered options, like Patient Access Curator and AI Advantage, can break the denial cycle on your group.