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Nearly 17% of In-Network Claims Were Denied by ACA Marketplace Plans in 2021

Analysis  |  By Jay Asser  
   February 16, 2023

Research finds lack of prior authorization as one of the foremost reasons for denials by non-group qualified health plans (QHPSs).

Health insurers on the Affordable Care Act (ACA) marketplace denied an average of 16.6% of in-network claims in 2021, according to a brief by Kaiser Family Foundation (KFF).

Researchers analyzed data released by CMS on claims denials and appeals for QHPs offered on for the 2021 plan year and found that denial rates ranged significantly from 2% to 49%. The dataset included 162 QHPs that reported receiving at least 1,000 in-network claims and showed data on claims received and denied.

Of the 291.6 million in-network claims received between the insurers, 48.3 million were denied (16.6%) while 243.3 million (83.4%) were paid. In 2021, 41 insurers had a denial rate of less than 10%, 65 insurers denied between 10% and 19%, 39 insurers denied between 20% and 29%, and 17 insurers denied 30% or more.

Health plans that reported denying one-third or more of claims were Meridian Health Plan of Michigan, Absolute Total Care in South Carolina, Optimum Choice in Virginia, UnitedHealthcare of Arizona, Health Net of Arizona, Buckeye Community Health Plan in Ohio, Celtic Insurance in seven states, and Ambetter Insurance in three states.

Researchers also examined the 44.7 million reasons health plans reported for denying the claims. Lack of prior authorization or referral accounted for 3.6 million (8%), excluded services made up six million (13.5%), medical necessity reasons were 920,000 (2%), and all other reasons accounted for the remaining 34.2 million (76.5%).

Many prior authorization denials occur due to insufficient documentation and an inability to match information that is spread across different systems. Automating the administrative process has become a strategy for revenue cycle leaders, with 78% of respondents in a report by KLAS saying they saw improved financial performance after implementation.

When it comes to ACA data, the KFF brief highlights that CMS does not collect out-of-network claims submitted and out-network enrollee cost sharing and payments.

The researchers state that the lack of required transparency in coverage data reporting by other non-group plans or employer-sponsored plans contributes to hindering improvement with denials.

"The federal government has not expanded or revised transparency data reporting requirements in years and does not appear to conduct any oversight using data that are reported by marketplace plans. As a result, consumers are not provided any information about how reliably marketplace plan options pay claims and plans reporting high claims denial rates do not appear to face any consequences."

Jay Asser is the contributing editor for strategy at HealthLeaders. 


Kaiser Family Foundation researchers analyzed CMS data on claims denials for non-group qualified health plans and uncovered 291.6 million in-network claims received between the insurers in 2021.

Of those, 48.3 million were denied (16.6%), with denial rates ranging from 2% to 49%.

Lack of prior authorization or referral accounted for 3.6 million (8%) of the 44.7 million reasons health plans reported for denying the claims.

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