Rejected vs. Denied Claims- What's the Difference?

Posted by Daniel Ramsey on April 6, 2022
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Whether you know it or not, rejections and denials are the biggest reasons you’re not getting paid. 

Let’s explore the difference between rejected and denied claims so you can improve your practice’s clean claim submission rate.  

What is a Rejected Claim?  

A rejected claim occurs when one or more errors prevent the insurance company from processing the claim.   

These errors include:  

  • Clerical errors  
  • Incorrect patient data or procedure/diagnosis code errors  
  • Missing/invalid provider and payor information  

Rejections occur in your clearinghouse.   

The clearinghouse ‘scrubs’ the claim to ensure all information needed by the insurance company is present and accurate.  

Claims with missing or incorrect data will be rejected before reaching the insurance company’s claims department.  


What is a Denied Claim?  

A claim is denied after it has been received and processed by the insurance company.   

Common claim denials include but are not limited to:  

  • Absent insurance referral or authorization  
  • Submitting claims outside the payor’s timely-filing limit  
  • Medical necessity issues  
  • Provider enrollment/credentialing issues   

These issues will cause the payor to deem your claim as ‘unpayable’.

The Difference Between Rejections and Denials 

The difference between rejected and denied claims is that rejected claims occur before being received and processed by insurance companies. Denied claims have been received and processed by insurance companies. 

In most cases, rejected and denied claims can be corrected and resubmitted.

Your biller needs to prioritize managing both rejected and denied claims to avoid unnecessary write-offs.  

Here’s a simple way to calculate your practice’s denial rate 

If you aren’t happy with your practice’s denial rate. Give our experts a call, we can train your billing staff or manage your entire revenue cycle for you.   

For more information, call 508-422-0233 or send an email to

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Topics: Billing

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