AI Seen as Key to Reducing Health Care Claim Denials, Survey Finds

Health care providers face mounting claim denials, data errors, and staffing shortages, according to Experian Health’s 2025 State of Claims survey.¹ Although 67% of providers believe artificial intelligence (AI) can improve the claims process, only 14% have implemented AI tools. The findings point to a widening gap between awareness and adoption, with missed opportunities to improve revenue cycle performance.

“I know there's a lot of discussion and debate, and I would call it ideation, around AI right now and how to apply it in health technology, specifically in the revenue cycle,” said Clarissa Riggins, chief product officer, Experian Health, in an interview with The American Journal of Managed Care® (AJMC®). “I think the big message to take away is that health systems and hospitals don't have to overhaul everything all at once. They can start small and be incremental with it, especially as budgets continue to be tight [and] there are staff shortages.”

Denials Are on the Rise

Claim denials in health care are escalating due to persistent data inaccuracies, staffing shortages, and outdated technology, in which 41% of providers now experience denial rates of 10% or higher, a significant increase from previous years, according to the survey.² The primary causes identified include missing or inaccurate data (50%), authorization issues (35%), and incomplete or inaccurate patient registration data (32%).¹ These challenges are compounded by a 43% understaffing rate among providers, leading to increased manual rework of denied claims, with 90% requiring at least some human review before resubmission.

Previous data from Komodo Health revealed a 16% increase in prescription drug denials between 2018 and 2024, particularly affecting essential medications for chronic conditions such as diabetes and asthma.² These denials, which are often driven by cost-containment strategies like prior authorizations, can delay treatment, worsen health outcomes, and increase financial and administrative burdens for both patients and providers. By leveraging large-scale health data and AI-driven solutions, firms are aiming to help providers reduce the impact of denials, streamline appeals, and improve patient access to care.

“Insurance claim denials can impact patient care for sure,” said Christopher Gold, DO, an internal medicine physician at Mount Sinai, New York, in an interview with AJMC. "They can be stressful or inconvenient to patients. Other times, they can carry potential for further issues or medical complications. They can affect patients clinically, financially, and mentally.”

Fragmented eligibility check systems are also a growing challenge in health care revenue cycles, contributing to longer claim processing times and increased denials.³ The report finds that 81% of providers now use 2 or more solutions to collect patient information at check-in—up from 79% in 2024. This reliance on multiple systems creates inefficiencies and redundancies, requiring staff to rerun eligibility checks and manually reconcile data. The result is slower workflows, higher administrative burden, and greater risk of errors that can trigger denials, underscoring the need for streamlined, integrated eligibility verification solutions.

Additionally, the survey finds economic pressures are intensifying the urgency for timely payer reimbursements, with 73% of respondents—up from 68% in 2024—saying the economy and declining collections heighten this need. This financial strain is driving a clear priority for providers, in which 82% of respondents identified denial reduction as a key organizational goal, according to the survey.

AI Is Key, Yet Adoption Remains Low

Reflecting urgency to improve denial rates amid a fragmented eligibility system and economic strains, 41% of providers upgraded or replaced their claims management technology in the past year, the survey finds. Yet significant gaps remain, as only 56% say their current claims technology sufficiently meets revenue cycle demands—a steep decline from 77% in 2022—signaling both the growing challenges and the need for innovation in claims management.

Despite recognizing the potential of AI to address these issues, with 67% of providers believing AI can improve the claims process, the survey finds adoption remains low at just 14%. This gap is attributed to concerns over AI's accuracy, HIPAA compliance, training requirements, and its ability to understand payer-specific rules.

Among providers currently using AI in their claims processes, adoption takes several forms. A total of 10% have developed AI solutions in-house, 40% rely on products from technology vendors, and 49% use a combination of both in-house and vendor-supplied tools. The results are promising, with 69% of these users reporting that AI solutions have reduced claim denials and/or improved the success of resubmissions, demonstrating AI’s growing potential to streamline revenue cycle workflows and improve financial outcomes.

“I think the most powerful use of AI in claims is really about how you prevent errors before they even reach a payer, before it even gets to the other side of that visit,” said Riggins. “There’s a lot that providers and health systems can do to make sure that, going back to understanding the end-to-end revenue cycle process, you embed AI or transformational tech at the very beginning, at the point of entry, so that upfront, you can easily flag any missing documentation, any missing or incorrect demographic data, anything that we know or have data on that shows what the payer-specific requirements are in real time.”

Is It Time to Replace the Current Claims Management System?

The survey finds that managing claims within the revenue cycle is an ever-evolving challenge, with shifting policies, updated contracts, modified authorizations, changing codes, and emerging security concerns making last year’s solutions less effective. Reflecting this reality, more than half of providers (54%) review or evaluate their claims management processes annually, according to the survey. Although replacing an entire claims management platform remains a significant undertaking, it may be considered necessary.

Rising denials were found to be the top driver for a better claims management system, cited by 39% of providers, followed by the potential for better-performing technology (29%), standard annual evaluations (27%), security concerns (26%), and a reliance on largely manual processes (21%). These factors underscore why claims management technology is under constant reassessment in the quest for efficiency and improved financial performance.

Furthermore, AI solutions in health care claims management need to be sustainable and strategically implemented, explained Riggins. Providers should focus on several key areas. First, they should prioritize financial outcomes and staff workflow relief, such as reducing denial rates, shortening days in accounts receivable, and saving time. Equally important is the use of reporting and analytics to benchmark performance and continually demonstrate value. Providers should also ensure that AI tools are capable of learning and adapting to dynamic payer rules and policies, which are constantly evolving. Finally, organizations should expect AI solutions to continuously justify their value, supporting not only short-term gains but also the long-term financial health of the system.

“The metrics can't just be a one-shot deal where, after the first 90 days, everyone's happy patting themselves on the back,” said Riggins. “It's got to sustain and run, and that’s equally as important.”

Overall, ensuring data accuracy and submitting clean claims quickly have long been top priorities for revenue cycle leaders, and technology plays a critical role in streamlining these processes. Automation, increasingly enhanced by AI, offers hope of more accurate claims and faster reimbursements.

References

1. Experian Health’s 3rd Annual State of Claims Survey finds denials still on the rise amid escalating challenges. Experian Health. News release. September 22, 2025. Accessed September 25, 2025. https://www.businesswire.com/news/home/20250922969006/en/Experian-Healths-3rd-Annual-State-of-Claims-Survey-Finds-Denials-Still-on-the-Rise-Amid-Escalating-Challenges

2. Grossi G, Steinzor P. As claims denials surge, AI and data-driven insights equip clinicians, hospitals to fight back. AJMC. Published March 13, 2025. Accessed September 30, 2025. https://www.ajmc.com/view/as-claims-denials-surge-ai-and-data-driven-insights-equip-clinicians-hospitals-to-fight-back

3. The state of claims: 2025. Experian Health. September 22, 2025. Accessed September 25, 2025. https://www.experian.com/healthcare/resources-insights/thought-leadership/white-papers-insights/state-claims-report