Hospitals’ push to cut claim denials isn’t improving their cash flow. Despite progress in reducing denial rates, insurers are now clawing back more money from already-approved payments, leaving providers with little net gain, according to a new analysis.
Kodiak Solutions found that insurers took back a larger share of paid claims in the first half of 2026 than in the same period last year. The percentage of accounts receivable recovered through clawbacks rose to 1.57% from 1.38%, a 13.8% increase. Meanwhile, providers recovered only 2.21% of accounts receivable after appeals in 2026, down from 2.48% in early 2025.
This shift comes as hospitals and physician groups reported lower initial and final denial rates—yet the financial relief is minimal. The trend held across all payer types and care settings Kodiak reviewed, covering 2,300 hospitals and 375,000 physicians. Medicare Advantage plans stood out for higher denial rates and more than double the clawback rate compared to traditional Medicare.
Commercial insurers, often the same companies behind Medicare Advantage plans, also showed worsening clawback rates. While initial denials for commercial claims fell year-over-year, final denials rose by 9.1%, reaching 2.89%. Clawbacks increased by 12%, hitting 2.25% of accounts receivable in early 2026.
Providers are winning fewer appeals despite lower denials. The data suggests insurers are compensating for reduced upfront rejections by targeting paid claims for post-payment audits. This creates a revenue cycle paradox: fewer outright denials, but more money lost after payment.
The analysis highlights how insurers adjust tactics when denial rates drop. By focusing on clawbacks instead of outright rejections, they maintain financial pressure on providers without triggering the same level of pushback. This approach forces hospitals to monitor every stage of the revenue cycle, not just denials, to protect cash flow.
Matt Szaflarski, vice president of revenue cycle intelligence at Kodiak, said the findings show the need for a holistic view of revenue cycle performance. He noted that providers must evaluate not only how much they collect but also how hard they had to work to secure those funds and how much of what they collected they ultimately retained.
