Health Insurance Denial Statistics 2025: What Every Provider Needs to Know

Health insurance denials are not a fringe problem — they are a systemic crisis. In 2023, ACA marketplace insurers denied 1 in 7 claims filed by in-network providers, according to KFF analysis of CMS data. That rate has held steady or worsened each year since the ACA reporting requirement began. Understanding the current denial landscape is the first step to fighting back.

This post compiles the most current denial statistics from CMS, KFF, AHIP, and the AMA so providers and patients have a clear, data-backed picture of what is happening — and what can be done about it.

Overall Denial Rates by Insurer (2026)" class="auto-link">Denial Rates: The National Picture

ACA Marketplace Plans

The most comprehensive denial data comes from CMS's Transparency in Coverage requirement. Insurers offering ACA marketplace plans must report claim-level denial data annually.

Key figures (2023 reporting year, published 2024):

Source: KFF analysis of CMS Transparency in Coverage data, 2024.

The 15% average masks enormous insurer-to-insurer variation. Some insurers deny fewer than 5% of claims. Others deny more than 40%. This is not random — it reflects deliberate policy and utilization management choices.

Medicare Advantage vs. Traditional Medicare

Medicare Advantage (MA) plans have attracted significant scrutiny from the HHS Office of Inspector General and Senate Finance Committee for denial practices.

• MA plans denied 13.4% of Prior Authorization Denied: How to Appeal" class="auto-link">prior authorization requests that met Medicare coverage rules (OIG report, 2022)
• Of those improperly denied requests, 75% were eventually approved on appeal
• Traditional Medicare fee-for-service denied approximately 3–4% of claims in the same period

The gap between MA denial rates and fee-for-service denial rates has become a central focus of CMS enforcement, leading to new audit requirements beginning in 2024.

Medicaid

State Medicaid programs deny claims at rates that vary dramatically by state and managed care organization. The Government Accountability Office (GAO) reported in 2023 that:

• Denial rates across state Medicaid programs range from 4% to 22%
• Prior authorization denial rates are highest in states that rely heavily on managed care organizations (MCOs)
• Fewer than 2% of Medicaid beneficiaries file formal appeals despite high denial rates

Denial Rate Trends Over Time

ACA Marketplace Average In-Network Denial Rate (2016–2023)

2016  |██████████░░░░░░░░░░| 17%
2017  |████████████░░░░░░░░| 18%
2018  |█████████░░░░░░░░░░░| 15%
2019  |████████░░░░░░░░░░░░| 14%
2020  |████████░░░░░░░░░░░░| 13%  ← COVID effect (fewer claims filed)
2021  |█████████░░░░░░░░░░░| 15%
2022  |█████████░░░░░░░░░░░| 15%
2023  |█████████░░░░░░░░░░░| 15%

Source: KFF / CMS Transparency in Coverage

Denial rates did not improve during the post-ACA era — they stabilized at a persistently high level. The brief dip in 2020 is largely explained by the massive reduction in elective care during COVID-19 lockdowns, not by any policy improvement.

Denial Rates by Insurer Type

Commercial / Private Plans

AHIP (America's Health Insurance Plans) reported in its 2023 survey that commercial plans approved 88.6% of all medical claims — implying an 11.4% denial rate. However, AHIP's methodology counts claims that never reach adjudication differently than CMS, making direct comparison difficult.

Independent analyses of employer-sponsored insurance (ESI) show:

• Prior authorization denial rates in commercial plans: 6–12% depending on procedure type
• Step therapy denials (fail-first requirements): approximately 24% of specialty drug requests denied at first submission (AMA, 2023)
• Coding-related denials (fixable): account for 35–50% of all commercial denials (Change Healthcare, 2022)

Medicare Advantage by Parent Company

Source: Senate Finance Committee investigation, 2022–2023; OIG audit data.

These figures refer specifically to prior authorization denials in Medicare Advantage — not all-cause denial rates.

State-by-State Variation

Denial rates vary significantly by state, driven by:

1. State insurance regulations and external appeal rights
2. Insurer market concentration (monopoly markets show higher denials)
3. Medicaid expansion status and MCO penetration
4. State enforcement resources

Highest ACA marketplace denial rates (2023 CMS data):

Lowest ACA marketplace denial rates (2023 CMS data):

States with robust external appeal laws and active insurance regulators consistently show lower denial rates, suggesting enforcement is a meaningful lever. See our detailed post on state-by-state denial rates and appeal laws for a full breakdown.

What Providers Are Experiencing: AMA Survey Data

The American Medical Association surveys physicians annually on prior authorization and denial burdens. In its 2023 Prior Authorization Physician Survey:

• 94% of physicians said prior authorization delays care
• 89% said PA requirements sometimes or often lead to abandonment of recommended treatment
• 29% of physicians employ staff dedicated primarily to prior authorization and appeals work
• Physicians spend an average of 13 hours per week on prior authorization paperwork
• 24% of practices reported a serious adverse patient event (hospitalization, disability, or death) attributed to prior auth delays

On claim denials specifically:

• 82% of physicians reported claim denials increased in the past 3 years
• Average revenue written off per physician due to denials: $50,000–$80,000 per year (small practices)
• 60% of denials that are appealed are ultimately overturned — yet most providers do not appeal

Why So Many Denials Go Unappealed

KFF's 2023 analysis of ACA marketplace data found that only 0.1% of denied claims are appealed by patients. Among providers who appeal on behalf of patients, appeal rates are higher but still below 10% for most practices.

The gap between "could appeal and win" and "actually appealed" represents billions in annual revenue left on the table. The barriers are well-documented:

1. Time burden — appeals require clinical documentation, cover letters, peer-to-peer requests
2. Uncertainty — providers do not know which denials are most likely to be overturned
3. Staff capacity — small practices lack billing staff to manage complex appeals
4. No tracking — most EHR systems do not automatically flag denial appeal deadlines

This is the problem ClaimBack was built to solve.

The Data Providers Need to Act On

Five findings from this data deserve immediate attention from every practice manager and revenue cycle leader:

1. 60% of appealed denials are overturned. If you are writing off denied claims without appealing, you are leaving recoverable revenue behind.

2. Prior authorization is the single largest driver of denials. Practices that implement PA tracking and proactive documentation protocols significantly reduce their denial rates.

3. Insurer denial rates vary by up to 4x. Knowing which payors are most aggressive allows you to prioritize your appeals and contract negotiations.

4. Coding errors are fixable. Up to half of all commercial denials are coding-related and can be corrected and resubmitted without a formal appeal.

5. Appeal deadlines are short. Most commercial plans require appeals within 180 days. Medicare advantage plans often require appeals within 60 days. Missing deadlines forfeits your right to appeal.

How ClaimBack Uses This Data

ClaimBack analyzes payor-specific denial patterns to generate appeal letters calibrated to each insurer's known overturn criteria. Rather than sending a generic letter, ClaimBack draws on:

• CMS Transparency in Coverage denial data
• Insurer-specific medical policies
• CMS coverage determinations and LCD/NCD databases
• Documented appeal success language from overturned cases

The result is an appeal letter that addresses the specific denial reason, cites the relevant clinical evidence, and matches the documentation standard each insurer uses to evaluate appeals.

If your practice is absorbing denied claims without appealing, you are subsidizing a system that profits from your inaction.

Generate your appeal letter with ClaimBack — free for your first denial.

Related Resources

• Insurance Appeal Success Rates by Insurer (2024–2025 Data)
• The 15 Most Common Reasons Health Insurance Claims Are Denied
• The Real Cost of Denied Claims to Healthcare Providers
• How to Appeal an Insurance Denial
• Medical Necessity Denial Appeal Guide

Sources

1. KFF. "Claims Denials and Appeals in ACA Marketplace Plans, 2023." kff.org, 2024.
2. Centers for Medicare & Medicaid Services. Transparency in Coverage Machine-Readable Files, 2023 plan year.
3. HHS Office of Inspector General. "Medicare Advantage Prior Authorization: Actions Needed to Improve Compliance." OEI-09-18-00260, 2022.
4. U.S. Senate Finance Committee. "Majority Staff Report on Medicare Advantage Denials." 2022.
5. American Medical Association. "2023 AMA Prior Authorization Physician Survey." ama-assn.org.
6. Government Accountability Office. "Medicaid Managed Care: CMS Should Improve Oversight of Access to Care." GAO-23-105512, 2023.
7. AHIP. "Health Plan Claim Payment and Denial Data, 2023." ahip.org.
8. Change Healthcare. "2022 Revenue Cycle Denials Index." changehealthcare.com.