Denied for “Other”

Every insurer selling on HealthCare.gov must tell the federal government why it denies claims. In 2024, those insurers received roughly 451 million in-network claims and denied about 85 million of them — 19% — and reported the reasons in categories CMS defines.¹ The largest reported category, at 36%, is “Other.”¹

Set that against the categories that actually name something. Administrative reasons — the machinery of billing itself — account for 25% of reported denial reasons. An excluded service, 13%. A missing prior authorization or referral, 9%. Medical necessity — the ground on which appeals are fought — just 5%.¹ The label that explains nothing outweighs excluded services, missing authorizations, and medical-necessity judgments combined.

This is not a one-year artifact. In the 2023 reporting cycle, “Other” also led the distribution, at 34%; in 2024 it grew to 36%.¹² Two consecutive years of federal transparency data, and both times the modal answer to “why was this claim denied?” is none of the above.

What makes 36% “Other” remarkable rather than merely disappointing is that American claims adjudication already runs on a machine-readable reason system. Every electronic remittance carries Claim Adjustment Reason Codes — CARCs — maintained by X12, the standards body behind the transaction formats payers and providers are required to use. X12’s own description of the code list: the codes “describe why a claim or service line was paid differently than it was billed.”³ There are hundreds of them, each specific enough to act on.

A provider never receives a denial labeled “Other.” The EOB or remittance says CO-50 (not medically necessary), or CO-197 (no prior authorization), or CO-16 (claim lacks information). The specificity exists at the wire level, on every single claim. It disappears somewhere between the payer’s adjudication system and the spreadsheet the public is allowed to see.

The asymmetry is the story. Between payer and provider, the reason for every adjustment is encoded, coded, and transmitted on a standard the industry has maintained for decades. Between payer and public, it collapses into buckets loose enough that more than a third of the volume lands in a category with no content. The transparency regime asks less of insurers than their own remittance systems already produce.

A black box has behavioral consequences. Of the roughly 85 million in-network denials in 2024, consumers appealed 262,982 — fewer than 1% — and insurers upheld their own decision in 66% of those internal appeals.¹ A denial whose public reason is “Other” is hard to argue with by design; the argument has to start from the CARC on the remittance, because that is the only legible reason anyone was given. KFF notes the reported data cannot even be linked to the services denied — neither the share of claims denied for a given reason nor the service most often denied can be computed from what insurers file.¹