5 Most Common Reasons Insurance Claims Get Denied (And How to Fight Back)

Getting a denial notice from your insurance company is one of the most frustrating experiences in healthcare. But here's what most patients and providers don't know: the majority of denied claims are overturned on appeal. According to a Kaiser Family Foundation analysis of ACA marketplace plans, insurers deny roughly 17% of in-network claims — and the vast majority of those denials are never challenged. Of the ones that are appealed, patients win a significant portion.

Understanding why your claim was denied is the first step to winning your appeal. Here are the five most common denial reasons, what each one means, and exactly how to fight back.

1. Not Medically Necessary (CO-50, CO-151)

This is the single most common denial reason, and it's also the most winnable. When an insurer says a service wasn't "medically necessary," they mean their internal criteria weren't satisfied — not that your doctor made a bad clinical decision.

Insurers rely on tools like InterQual or MCG Health criteria to define medical necessity. If the documentation submitted with your claim didn't check enough boxes in their algorithm, the claim gets flagged automatically — often without a physician ever reviewing it.

How to fight back:

• Request the specific medical necessity criteria the insurer used to deny the claim.
• Have the treating physician write a detailed letter of medical necessity citing the patient's diagnosis, symptoms, failed alternative treatments, and clinical evidence supporting the service.
• Reference relevant CMS Local Coverage Determinations (LCDs) or National Coverage Determinations (NCDs) that support the procedure.
• Request a peer-to-peer review between the treating physician and the insurer's medical reviewer — this is a highly effective step that many providers overlook.

2. Prior Authorization Missing or Invalid (CO-197)

CO-197 is one of the fastest-growing denial codes in the industry. It means a service was performed without the required pre-authorization, or the authorization obtained doesn't match the service billed.

Prior auth denials are maddening because the care already happened — and in many cases, the auth was obtained, but there's a mismatch in procedure codes, dates of service, or provider information.

How to fight back:

• Pull your authorization records and compare every field: procedure code, date, rendering provider NPI, facility. Even a one-digit discrepancy can trigger a denial.
• If auth was genuinely not obtained: document that the service was urgent or emergent, or that the patient was at risk if care was delayed.
• Reference the No Surprises Act provisions if an out-of-network provider was involved in an emergency or facility-based setting.
• For retroactive denials, argue that the standard of care required immediate treatment and that any delay would have constituted medical negligence.

Want a complete guide to CO-197? See our CO-197 denial code reference page with sample appeal language.

3. Claim Lacks Information or Has Submission Errors (CO-16)

CO-16 is deceptively simple: the claim is missing required information or contains data that doesn't match the payer's records. This is one of the easiest denials to fix — and one of the most common.

Common culprits include: patient demographics that don't match (a transposed digit in a date of birth, a name that differs from the insurance card), missing or incorrect referring provider NPI, and mismatched subscriber IDs.

How to fight back:

• Call the payer before resubmitting. Ask specifically which field triggered the denial — they're required to tell you.
• Cross-reference the patient's insurance card against what was submitted field by field.
• Correct the error and resubmit as a corrected claim (not a new claim) using the original claim number.
• Include a cover letter identifying what was corrected and citing any applicable timely filing extensions caused by the payer's error.

4. Duplicate Claim (CO-18)

A duplicate claim denial means the payer believes they've already processed a claim for this service. This is often a false positive — triggered when a corrected claim gets flagged as a duplicate, or when two similar claims (different dates, different modifiers) look identical to the system.

How to fight back:

• Request an explanation from the payer of which claim is considered the "original" — they should be able to provide the claim number and processing date.
• If the denial is based on a corrected claim being treated as a duplicate, clearly reference the original claim number in your appeal.
• If two genuinely different services were provided on the same date, attach documentation showing they were separate and distinct services.
• For multiple sessions on the same day (common in physical therapy), ensure each claim has the appropriate modifier and time documentation.

5. Not a Covered Benefit (CO-96, CO-97)

CO-96 and CO-97 both relate to coverage exclusions. CO-96 means the service is not covered under the patient's specific benefit plan. CO-97 means the benefit for this service was already applied (usually a cap or limit was reached). These are generally the hardest denials to overturn — but not impossible.

How to fight back:

• Review the actual policy language, not just the denial letter. Exclusions are often more narrowly written than insurers claim.
• Check if a mental health parity argument applies (Mental Health Parity and Addiction Equity Act). Insurers cannot apply stricter limits to mental health/substance use services than to comparable medical/surgical services.
• If the service is excluded but medically necessary with no covered alternative, argue for an exception on medical necessity grounds.
• For CO-97 (benefit exhausted), review the plan's explanation of benefit payments to verify the cap calculation is accurate.

The Bottom Line: Appeal Everything

Insurance companies count on the fact that most patients and providers won't appeal. The administrative burden is real — but so is the money. For providers, a single successful appeal can recover thousands of dollars. For patients, it can mean the difference between financial hardship and getting the care they need covered.

The most important thing you can do when you receive a denial is act quickly. Most payers require appeals within 90-180 days of the denial date, and some state laws give you even tighter windows.

For a complete reference of all denial codes and how to appeal each one, visit our Denial Code Library. And download our free guide for step-by-step appeal templates you can customize for any denial.