Claim denial

Claim denial occurs when an insurance company refuses to pay a claim submitted by a policyholder. Common reasons for claim denials include non-covered services, missed premium payments, incomplete documentation, or filing after the deadline.

Major insurers such as UnitedHealthcare and Blue Cross Blue Shield report denial rates between 15% and 20% annually for submitted health claims. Top-denied claim types include out-of-network care, lack of prior authorization, and coding errors such as using CPT code 99213 instead of 99214.

Most companies provide a written explanation of benefits (EOB) outlining specific reasons for the denial. Policyholders can appeal denied claims through formal review processes regulated by state laws and the Affordable Care Act.

Supporting documentation, such as itemized bills or physician statements, increases appeal success; appeals overturn about 40% of initial denials in some states like California. Insurance agents recommend reviewing coverage details before filing to prevent errors causing denials.

Electronic Health Record (EHR) systems reduce paperwork mistakes leading to administrative denials in hospitals like Mayo Clinic. Legal recourse is possible if insurers deny claims without valid grounds under ERISA regulations, as reported by YourInsurance.info (Your Insurance Info).

Denial notifications typically arrive within 30 days for auto, health, or homeowners policies following claim submission.