High Rates of Denied Health Insurance Claims Reversed in NY

A recent investigation into denied health insurance claims in New York uncovered a significant number of reversals, with overturn rates at the independent review organization (IRO) level spanning from 30% to 78%. This analysis, featured in JAMA Internal Medicine by Dr. Joseph Dov Bruch from the University of Chicago and colleagues, assessed 51,394 external appeals closed between May 2019 and December 2025. Approximately 47% of these cases experienced a reversal of the initial denial after independent review by physicians and specialists.

The study identified particularly high reversal rates in certain claim categories. Home health care services saw 78.4% of denials overturned upon independent review. Similarly, claims associated with surgical services, dental procedures, and prescription drugs also observed over 50% of denials being reversed following IRO evaluation.

By diagnostic category, the overturn rates demonstrated variability. Denials for substance abuse treatment were overturned at a rate of 61.5%, while 60.6% of mental health service denials were reversed. Claims concerning the central nervous system, endocrine disorders, and cancer had overturn rates of 53.1%, 52.1%, and 45.1%, respectively.

In evaluating insurers, the study revealed differing overturn rates. Denials under Centers Plan for Healthy Living were overturned 85% of the time. Other insurers like Aetna, Excellus, CVS Caremark, Fidelis Care, and Anthem Blue Cross Blue Shield had reversal rates of 51.1%, 50%, 49.8%, 48.3%, and 43.1%, respectively. Dr. Bruch pointed out the significant opportunity for consumers to seek independent reviews following internal appeals, highlighting the frequent case reversals.

The research also indicated that 47.1% of denials based on medical necessity were overturned, along with 44% labeled as experimental and 42.9% of formulary-related denials. The findings showed a substantial increase in overturned cases, from 38% in 2019 to 52.5% in 2025, with appeal volumes surging from 4,128 to 9,805 in the same period. In New York, the IRO process stands as a final level of appeal after insurers' initial and internal processes, conducted by board-certified providers.

Dr. Bruch suggested the potential for regulatory intervention for insurers with frequent overturned denials. She emphasized the importance of systemic improvements to address factors like human error, outdated systems, or other inappropriate practices, allowing regulators to better scrutinize denial trends.