The Top 10 Medical Billing Denials of 2026 (And How to Fix Them)
The average medical practice loses $15,000 to $40,000 annually to preventable claim denials. That's not revenue sitting in accounts receivable waiting to be collected—it's money that simply disappears because denied claims get written off, appeals expire, or administrative teams lack the bandwidth to fight back.
Industry data shows that denial rates have been climbing steadily over the past three years. Between 2021 and 2023, denial rates for inpatient services increased by 51%, and private insurers now reject approximately 15% of submitted claims on first pass. The financial impact is staggering: healthcare providers collectively spend $19.7 billion annually just reviewing and appealing denials, with more than half of that ($10.6 billion) wasted on claims that should have been paid initially.
The frustrating reality? Most denials are entirely preventable. After analyzing thousands of denied claims across our client base, we've identified patterns that cost practices real money every single day. At A-Z Medical Billing & Consulting, we maintain denial rates below 4% for our clients—well under the industry average of 15%—by implementing systematic prevention protocols that catch errors before they become expensive problems.
Here are the ten denial codes we see most frequently in 2026, along with the exact fixes that will prevent them from eating into your revenue.
1. CO-18: Duplicate Claim Submission
This denial indicates that the payer has already received and processed a claim for the exact same service, date, patient, and provider. Insurance companies compare every incoming claim against their database to detect duplicates, and when they find one, they reject it immediately with code CO-18.
Duplicate submissions typically happen in one of three scenarios: your billing staff accidentally clicks "submit" twice when the system lags, you resubmit a denied claim incorrectly (it should be submitted as a corrected claim, not a new submission), or you submit through multiple channels simultaneously—for example, sending both an electronic claim and a paper claim for the same service.
The financial impact seems minimal at first glance since you're not losing actual revenue, just creating administrative work. But duplicate claim denials create a dangerous pattern: they consume staff time investigating whether the claim was truly duplicate or if the payer's system made an error. They also delay legitimate resubmissions because your team wastes time tracking down phantom duplicates.
Implement a pre-submission duplicate check in your practice management system. Most modern billing software includes this feature but requires activation in settings. Before any claim leaves your system, it should be checked against claims submitted in the previous 90 days for the same patient, provider, date of service, and CPT codes. If your current system lacks this capability, use your clearinghouse's duplicate detection service—every reputable clearinghouse offers this as a standard feature.
When you need to resubmit a denied claim with corrections, always mark it as a corrected claim (use Claim Frequency Code 7) rather than submitting it as a new claim. This tells the payer's system to replace the original claim rather than flagging it as a duplicate.
2. CO-27: Patient Eligibility Expired
This denial means the patient's insurance coverage was not active on the date of service. Either their coverage had already terminated, it hadn't started yet, or there was a gap in coverage during the service period. This is one of the most preventable denials, yet practices lose thousands monthly because they're verifying eligibility once at appointment scheduling rather than immediately before service.
Insurance coverage changes constantly. Patients lose jobs, change employers, age out of parents' policies, fail to pay premiums, or switch to different plans during open enrollment. A verification performed two weeks before an appointment may be completely inaccurate by the time the patient arrives.
The real cost of CO-27 denials extends beyond the denied claim itself. When insurance won't pay, the patient becomes responsible for the full charge—and patient collections average only 50-60% success rates compared to 92-94% for insurance claims. You're not just losing the insurance payment; you're converting a reliable revenue stream into a far less dependable one.
Implement same-day or next-day eligibility verification rather than verifying at scheduling. Our velocity optimization protocol includes automated batch eligibility checks that run every morning for that day's scheduled patients and the following day's appointments. This catches any coverage changes that occurred after the initial scheduling verification.
For high-dollar procedures or services requiring authorization, verify eligibility again immediately before the service. The 24-hour batch check catches most issues, but for procedures over $500, the extra five minutes of real-time verification is worth the protection against denial.
Train your front desk staff to ask returning patients, "Has anything changed with your insurance since your last visit?" Patients often know they've switched coverage but assume their information is already updated in your system.
3. CO-4: Missing or Incorrect Modifier
Modifiers are two-character codes appended to CPT codes that provide additional context about how, where, or why a service was performed. The most common modifier-related denial involves Modifier 25, which indicates that an Evaluation and Management (E/M) service was significant and separately identifiable from a procedure performed on the same day.
Here's where practices get into trouble: they perform a minor procedure (like a joint injection or lesion removal) during an office visit where they also conducted a significant E/M service addressing unrelated issues. The claim gets submitted with both the procedure code and the E/M code, but without Modifier 25 on the E/M service. The payer's system sees two services billed together and assumes the E/M was just the standard work included in the procedure, so they deny the E/M charge with code CO-4.
According to industry research compiled by SelectHub, modifier-related denials represent a significant portion of coding errors that practices encounter, and they're entirely avoidable with proper documentation and coding protocols.
Create a standing protocol: whenever a minor procedure is performed during an E/M visit, your providers must document that the E/M service addressed problems separate from the procedure. The documentation should clearly indicate what was discussed and examined beyond the procedural work.
Your coding staff should automatically append Modifier 25 to E/M codes when billed alongside procedures with 0-day or 10-day global periods. Don't wait for the coder to remember—build it into your charge capture templates. If you're using an EHR with automated coding suggestions, configure it to flag E/M + procedure combinations and prompt for Modifier 25 documentation.
For other common modifier scenarios, create quick reference cards for your billing team showing which modifiers apply to which situations. The most frequently needed modifiers beyond 25 include: Modifier 59 (distinct procedural service), Modifier 76 (repeat procedure by same physician), and Modifier 24 (unrelated E/M service during post-op period).
4. CO-197: Authorization Missing or Invalid
This denial indicates that the service required prior authorization from the insurance company, but either no authorization was obtained or the authorization number provided was incorrect or expired. Authorization requirements have expanded dramatically over the past five years as payers look for ways to control costs.
The challenge with authorizations isn't just obtaining them—it's tracking them. A typical authorization might be approved for specific CPT codes, specific date ranges, and a maximum number of units. If any of these parameters are violated, the claim denies even though you technically had an authorization.
We see practices make three common authorization mistakes: they assume verbal authorizations are sufficient (most payers require written confirmation with a reference number), they obtain authorization for the initial service but fail to get authorization for follow-up treatments, or they bill services that fall outside the authorized scope without realizing it.
Implement a centralized authorization tracking system rather than relying on paper forms or scattered digital files. Every authorization should be logged with the reference number, approved CPT codes, date range, maximum units, and expiration date. This log should integrate with your scheduling system so that when a patient books an appointment requiring authorization, your staff sees the authorization status immediately.
For denied authorizations, file for retroactive authorization when permitted. Many payers allow retroactive auth requests within 30 days of service if the service was medically necessary and met their criteria. Don't just accept the denial—investigate whether retroactive approval is possible.
Consider using services like CareCloud's authorization management tools that automate authorization tracking and alert you when authorizations are approaching expiration or maximum unit limits.
5. CO-29: Timely Filing Limit Exceeded
This is the most painful denial to receive because it's usually permanent. CO-29 means you submitted the claim after the payer's deadline for filing, and most payers will not accept appeals on timely filing denials. The claim becomes a complete write-off.
Filing deadlines vary dramatically by payer. Medicare allows claims to be filed up to one year from the date of service. Many commercial payers have 90-day or 180-day filing limits. Some Medicaid programs allow only 60 days. If your billing operation doesn't track payer-specific filing deadlines, you're almost certainly missing some.
The revenue impact of timely filing denials compounds over time. Not only do you lose the specific claims that denied, but you also create a backlog problem. When claims aren't filed promptly, they stack up, and when your billing staff finally gets to them, some have already exceeded filing limits.
This is exactly what our 24-hour velocity protocol addresses. Claims should be submitted within 24 hours of encounter sign-off, not batched weekly or monthly. The faster claims leave your system, the more time you have to address any issues that arise before filing deadlines expire.
Build a payer-specific filing deadline matrix in your practice management system. When charges are entered, the system should calculate the filing deadline based on the payer and flag claims approaching their deadline. Most practice management systems support this feature but require manual configuration of each payer's requirements.
For claims that do exceed filing limits through legitimate delays (late remittance advice, delayed secondary insurance information), file them anyway with a detailed explanation. While payers aren't required to accept late claims, they sometimes make exceptions for documented reasons beyond your control. You lose nothing by trying.
6. CO-50: Service Not Deemed Medically Necessary
This denial indicates that the payer reviewed your claim and determined that the service provided wasn't medically necessary according to their coverage criteria. This is a clinical denial rather than a technical one, and it requires a different approach to fix.
Medical necessity denials typically stem from insufficient documentation linking the diagnosis to the treatment. Your provider may have had perfectly legitimate clinical reasons for ordering a test or procedure, but if those reasons aren't clearly documented in the medical record, the payer's reviewers can't see the justification.
Appeal CO-50 denials with comprehensive documentation showing clinical necessity. Include relevant lab results, imaging reports, and progress notes demonstrating why the service was appropriate. Many practices give up on medical necessity denials too quickly—payers expect you to provide supporting documentation, and overturn rates on these denials can reach 40-60% when proper evidence is submitted.
For ongoing services that frequently trigger medical necessity reviews (like advanced imaging, specific physical therapy codes, or specialty drug infusions), proactively include documentation with the initial claim rather than waiting for a denial. This "defensive documentation" approach prevents the denial entirely.
7. CO-16: Claim Lacks Information or Has Billing Error
This is the vaguest denial code, essentially telling you "something is wrong, but we won't specify what." CO-16 can indicate missing patient demographics, incorrect provider identifiers, wrong dates of service, or dozens of other data elements.
When you receive CO-16, call the payer immediately and ask for specific information about what's missing or incorrect. Don't guess and resubmit—you'll likely get denied again. Most payer customer service representatives can access detailed notes about why the claim was rejected and tell you exactly what needs correction.
Implement claim scrubbing software that validates data before submission. Your clearinghouse should offer this as a standard service, checking for missing required fields, invalid provider NPIs, incorrect patient demographic formatting, and other common errors. The scrubbing process adds one day to submission time but prevents weeks of denial follow-up.
8. CO-97: Service Included in Bundled Payment
This denial indicates that the service you billed separately is considered part of a bundled payment or global fee. Medicare's National Correct Coding Initiative (NCCI) and commercial payers' bundling edits determine which services can be billed separately and which are considered components of larger procedures.
Invest in coding reference software that includes bundling edits. Before billing procedures together, verify that they're not subject to bundling restrictions. When services were truly separate and distinct, appeal with documentation explaining why the services weren't components of each other. Use Modifier 59 (distinct procedural service) when appropriate to override bundling edits.
9. CO-167: Service Not Covered Under Patient's Plan
This denial means the patient's specific insurance plan excludes coverage for the service provided. This differs from medical necessity denials—the service might be perfectly appropriate medically, but the patient's particular plan doesn't cover it.
Verify coverage for non-routine services before providing them. For services not typically covered by insurance (certain cosmetic procedures, experimental treatments, specific durable medical equipment), obtain an Advance Beneficiary Notice (ABN) for Medicare patients or a similar written acknowledgment from private insurance patients that they'll be financially responsible if insurance doesn't pay.
10. CO-22: Coordination of Benefits Error
This denial appears when the payer believes another insurance should be paying the claim as primary coverage, but you billed them first. This happens frequently with patients who have coverage through both an employer plan and Medicare, or patients with both commercial insurance and Medicaid.
Thoroughly investigate patient insurance during registration. Ask specifically: "Do you have any other insurance coverage through a spouse, parent, former employer, or Medicare?" Update coordination of benefits information in your system, ensuring primary and secondary payers are correctly designated. When you receive CO-22 denials, correct the coordination of benefits in your system and resubmit to the correct primary payer first.
Why Las Vegas Practices Face Unique Denial Challenges
Practices operating in the Las Vegas market encounter specific challenges that increase denial risk beyond the national average. Nevada Medicaid, which covers a substantial portion of the Las Vegas patient population, maintains particularly strict prior authorization requirements and filing deadlines that differ from other states.
According to the Nevada Medicaid Provider Portal, Nevada publishes monthly "Top 10 Claim Denial Reasons" specific to their system, and these shift quarterly based on policy changes. For practices serving Medicaid patients, staying current with Nevada-specific requirements is critical.
The Las Vegas market also features several managed care organizations (MCOs) operating under Nevada Medicaid contracts, including Health Plan of Nevada, SilverSummit Healthplan, CareSource Nevada, and Molina Healthcare of Nevada. Each MCO maintains slightly different authorization processes, billing requirements, and appeals procedures. For medical billing companies in Las Vegas serving multi-payer practices, this complexity requires dedicated expertise in navigating each MCO's specific requirements.
The transient nature of Las Vegas's population creates additional eligibility verification challenges. Tourism and hospitality workers frequently experience employment changes, and the seasonal nature of some positions means coverage gaps are more common than in markets with more stable employment patterns. This makes same-day eligibility verification even more critical for Las Vegas practices than the national standard.
Additionally, Health Plan of Nevada—one of the largest commercial payers in the Nevada market—has specific requirements around claims reconsideration and appeals that differ from national carriers. According to their provider documentation, claims reconsiderations must include specific documentation and follow particular formatting requirements. Practices unfamiliar with these Nevada-specific requirements may find their appeals rejected on technicalities rather than merit.
For practices seeking medical billing companies in Las Vegas, partner selection should prioritize vendors with demonstrated expertise in Nevada Medicaid MCO requirements and established relationships with local payer provider relations departments. The nuances of Nevada's regulatory environment and the specific requirements of Las Vegas-area payers make local expertise valuable beyond standard medical billing knowledge.
Don't Fix Them One by One—Fix the System
Addressing denials individually is exhausting and unsustainable. You'll spend your days firefighting rather than preventing fires. The practices that successfully minimize denials don't just get better at fixing denied claims—they implement systematic prevention that stops denials from occurring in the first place.
This requires three foundational changes:
- Front-end prevention through claim scrubbing. Every claim should be validated against payer-specific requirements before submission. This includes checking for missing modifiers, verifying authorization numbers, confirming eligibility, and validating diagnosis-to-procedure linkage. According to research published by TechTarget, providers spend an average of $42.84 per claim fighting denials—money that could be saved entirely through better front-end processes.
- Velocity optimization. The faster claims move through your system, the more time you have to address issues before filing deadlines expire. Batching claims weekly or monthly creates artificial delays that erode your margin of error. Our clients submit claims within 24 hours of encounter sign-off, which gives them 89-179 days (depending on payer) to resolve any issues instead of 60-170 days.
- Systematic denial analysis. Track your denial patterns by payer, by provider, by procedure code, and by denial reason. When you see patterns, you can implement targeted fixes. If one provider consistently receives CO-4 denials for missing modifiers, that provider needs focused training on modifier requirements. If one payer consistently denies specific codes for medical necessity, you need to proactively include supporting documentation with initial submissions.
At A-Z Medical Billing & Consulting, we maintain denial rates below 4% by implementing all three of these systematic approaches for our clients. We don't just fix denied claims—we prevent them from happening through front-end scrubbing, aggressive submission velocity, and continuous analysis of denial patterns.
Your practice earned that revenue by providing medical services. You shouldn't lose it to administrative errors that could have been prevented with better systems.
Take the First Step: Free Denial Analysis
We're offering a complimentary denial analysis to practices that want to understand exactly where their revenue is leaking. We'll review 90 days of your denial data and provide a detailed report showing your top denial reasons and specific dollar amounts lost.
A-Z Medical Billing & Consulting was founded by Zain Vallly, who identified persistent revenue cycle inefficiencies while operating Vally Medical Group, a multi-location occupational medicine practice across Hawaii. The hands-on experience of managing billing operations for practices spanning multiple islands revealed systematic problems in how most billing services approach denial management. A-Z was built specifically to address these gaps through systematic prevention, aggressive pursuit of denied claims, and transparent reporting.
1. American Medical Association - Claims Recovery Data
2. Nevada Medicaid Provider Portal - 2025 Guidelines
3. Change Healthcare/TechTarget - The Cost of Denials
4. CMS.gov - National Correct Coding Initiative