Health insurance claim denial rates have reached record levels, with major insurers denying an average of 17% of in-network claims in 2025, according to a new report from the Kaiser Family Foundation. The findings have prompted a bipartisan congressional investigation.
The Senate Health Committee has issued subpoenas to the five largest health insurers demanding documentation of their denial practices, including the role of AI and automated systems in claim adjudication. Committee members from both parties expressed concern about the trend.
Prior authorization denials are a particular pain point, with 35% of all prior authorization requests being initially denied. Physicians report spending an average of 14 hours per week on prior authorization paperwork, taking time away from patient care.
Several states have passed legislation restricting prior authorization practices and requiring faster turnaround times for claim reviews. New York, California, and Texas now mandate that urgent prior authorization requests be processed within 24 hours.
Patient advocacy organizations report that 60% of denied claims are overturned on appeal, suggesting many initial denials lack medical justification. The appeals process, however, is burdensome enough that most patients never challenge their denials.
