Medical & Dental Finance Glossary
What is Claim Denial Rate?
Definition reviewed . Source observations retain their stated periods.
Also called: denial rate, first-pass denial rate
First-pass claim denial rate is the share of adjudicated initial insurance claim submissions a payer denies. State how pending claims are treated. A final-denial rate follows claims through later resolution and uses a different basis.
Denials create rework and can delay or reduce collections. Group a defined cohort of adjudicated first submissions by reason and payer, then investigate eligibility, authorization, coding, clinical and administrative issues. That shows your own avoidable work instead of assuming an industry-wide avoidable share.
KFF's analysis of 2023 HealthCare.gov insurer data, corrected March 24 2026, reports 20% of in-network claims ultimately denied, with insurer rates ranging 1% to 54%. Initially denied claims later resubmitted and paid are excluded from that final-denial rate. This is neither a ceiling nor a directly comparable practice first-pass rate, and it covers post-service claims for HealthCare.gov individual qualified health plans, excluding state-based Marketplaces, group plans and denied prior-authorization requests. Post-service claims denied for missing authorization remain included.
How it is calculated
First-pass denial rate = denied adjudicated initial claim submissions divided by all adjudicated initial submissions in the same defined cohort. State treatment of pending adjudications, rejections, duplicates, resubmissions and payer mix. Track denied dollar amounts and rework cost separately from claim counts.
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