Understanding Medicare Claim Denials: Why They Happen and How to Fix Them
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You’re not alone if you’ve ever received a medical bill that doesn’t seem right. Many people face issues with Medicare claim denials, leading to confusion and frustration. As insurance agents, we don’t handle billing directly, but we often get calls from clients who don’t know where else to turn.
Imagine visiting your doctor, getting the care you need, and assuming your Medicare plan will cover it—only to receive a denial letter weeks later. Now, you must figure out why the claim was denied and whether you’ll have to pay out of your pocket.
Unfortunately, medical claim denials are becoming more common across all types of insurance. Insurance companies process billions of claims each year. The Medicare claim denial rate is lower than employer-sponsored and marketplace insurance. A 2023 Kaiser Family Foundation (KFF) analysis found that 21% of employer-sponsored insurance claims and 20% of marketplace insurance claims were denied, compared to only 10% of Medicare and 12% of Medicaid claims.
The good news? Most Medicare claim denial reasons stem from simple mistakes. You can avoid unnecessary stress and unexpected medical bills by understanding why claims get denied and how to fix them.
Common Reasons for Medicare Claim Denials
When Medicare or an insurance company denies a claim, they use Medicare claim denial codes to explain why. These codes help doctors, hospitals, and patients determine the next steps. Here are some of the most common Medicare claim denial reasons:
- 1
Missing or Incorrect Information (CO-4, CO-16, CO-15)
o Example: The claim is missing key details, like a necessary code or authorization number.
o Solution: Double-check all details before submitting the claim. - 2
Diagnosis or Procedure Code Errors (CO-11, CO-50, CO-167)
o Example: The diagnosis doesn’t match the procedure.
o Solution: Ensure medical records clearly explain why the treatment was needed. - 3
Lack of Prior Authorization (CO-15)
o Example: Some treatments require approval before they can be performed. If this step is skipped, the claim will be denied.
o Solution: Confirm Medicare or your plan has approved the procedure beforehand. - 4
Late or Duplicate Claims (CO-18, CO-29, CO-97)
o Example: The doctor’s office sends the same claim twice or submits it too late.
o Solution: Track claims carefully and submit them on time. - 5
Coordination of Benefits Issues (CO-22)
o Example: If a patient has multiple insurance plans, the claim might be sent to the wrong one first or there is a dispute over which insurance has priority.
o Solution: Ensure the correct insurance is billed first.
How to Fix Medicare Claim Denials
If your Medicare claim is denied, don’t panic! Most denials happen due to minor mistakes that can be corrected. Here’s what you can do:
- 1
Find Out the Reason
Carefully read the denial letter. It will include a Medicare claim denial reason code or explanation. If you don’t understand it, call your doctor’s office, Medicare, or the insurance company if it is a Medicare Advantage plan to ask for clarification. - 2
Correct and Resubmit
If the denial resulted from missing or incorrect information, ask your doctor’s office to correct the mistake and resubmit the claim. - 3
File an Appeal
If you believe the denial was unfair, you can go through the Medicare claim denial appeal process to have the decision reviewed. Many Medicare Advantage claim denials and other denials are overturned when patients provide the correct information. - 4
Keep Good Records
Write down who you speak to and what they say. Keep copies of letters, emails, and any paperwork related to your claim. - 5
Be Persistent
Medicare and insurance companies often rely on patients giving up. Don’t let them win! If you believe your claim was wrongly denied, keep fighting until you get the right outcome.
Final Thoughts: Take Control of Claim Denials
Medicare claim denials cost billions each year and create unnecessary stress for patients. But in most cases, they can be fixed!
If your claim is denied, remember:
✅ Stay calm—many denials can be corrected.
✅ Ask questions—find out why the claim was denied.
✅ Take action—resubmit the claim or file an appeal.
By understanding Medicare claim denial reasons, keeping track of Medicare claim denial codes, and following the Medicare claim denial appeal process, you can prevent surprise medical bills and make sure your healthcare is covered. Don’t give up—fight for the benefits you deserve!
If you want someone in your corner who will help you with your Medicare problems, call us at 402-614-3389 and speak with a licensed insurance agent professional.