Massachusetts Report: 20% of Claims Denied in 2024

The Massachusetts Health Policy Commission (HPC) has released a study exploring insurance claims denials in the Bay State.

 In 2024, the state’s health insurers reported 45.9 million total commercial claims filed. The average overall rate of claim denial by insurers was 20.4%, meaning that approximately one out of every five claims submitted by providers to fully insured health insurers in Massachusetts was denied.

Strictly clinical reasons for denying coverage, including medical necessity, made up at most 1% of denials for any insurer, according to the study. The HPC found significant variation in the share of claims denied by insurers in Massachusetts, ranging from 28% by United Healthcare to 11% by Wellsense, but across insurers a large percentage of claims were denied for administrative reasons. 

“Other administrative denials” was the most common category by a significant margin, accounting for 11.7% of all claims (5.4 million). This category primarily includes claims denied for not meeting the insurers’ rules and procedures, including timely filing, correct documentation, and services that should be billed separately. Another 4.9% of all claims (2.2 million) were denied for an incomplete claim, coding error, or duplicate claim or coverage – combined, claims denied within these administrative categories represented over 16% of total claims, a total of 7.6 million claims in 2024. 

“The data on administrative claim denials highlight a broader issue across the healthcare system – administrative inefficiencies are illustrative of an overly complex system, and are a burden to clinicians, health plans, and ultimately patients. Each of those 7.6 million claims denied for administrative reasons represent time and resources spent by both a provider and insurer,” said HPC Executive Director David Seltz, in a statement. “These data show there are opportunities to improve how care is accessed and paid for. Simplifying and streamlining billing and claims submissions is a clear step we must take to address inefficiencies in the health care system, and a step forward to more affordable, equitable, and accessible healthcare for all Massachusetts residents.”