When the Biggest Health Systems Are Still Fighting Denials, That Tells You Something

By Angela Troccoli, Head of Marketing at Revecore

When HCA Healthcare and Universal Health Services talk about revenue cycle on their earnings calls, the industry listens. These are two of the largest for-profit health systems in the country. They are well-resourced, deeply staffed, and investing heavily in technology. So when their CFOs spend time on denial and underpayment pressure, it’s worth paying attention to what that signals for the rest of the market.

In their Q1 2026 earnings calls, both systems acknowledged that payer pressure — particularly from Medicare Advantage — remains a defining challenge. HCA CFO Mike Marks described denial and underpayment activity as “still really high,” even after years of added resources, technology, and targeted payer partnerships. UHS CFO Steve Filton credited their ability to hold the line to sustained investments in revenue cycle technology, personnel, and process.

If it's this hard for the best-resourced systems in the country, imagine how hard it’s become for everyone else.

The numbers behind the headlines

These earnings call comments are supported by broader market data that paints the same picture. Medicare Advantage plans saw denial rates spike 4.8% from 2023 to 2024 alone. A Health Affairs study covering 30% of the MA market found initial denial rates of 17%, with 57% of those denials ultimately overturned on appeal, which means hospitals are spending enormous resources fighting for revenue they were already owed.

The financial toll compounds quickly. In 2025, hospitals spent nearly $18 billion overturning claims denials, with the AHA estimating total spending of $43 billion trying to collect payments insurers owe for care already delivered. Meanwhile, the average denied amount for a Medicare Advantage-related claim rose 22.4% year-over-year, reaching approximately $1,000 per claim.

Underpayments tell an equally troubling story. Medicare reimbursed hospitals at just 83 cents on the dollar in 2024, resulting in over $100 billion in underpayments. Hospital reimbursement from MA plans fell 8.8% on a cost basis between 2019 and 2024 even as MA enrollment grew to cover more than half of all Medicare beneficiaries. Industry analyses suggest providers lose 1% to 11% of net patient revenue annually to underpayments alone.

And payer audits aren’t letting up. MDaudit’s analysis of more than 1.2 million providers and 4,500 facilities found a 30% year-over-year increase in total at-risk audit amounts per customer during the first three quarters of 2025, with the average at-risk amount per claim rising 18%.

What this means for community and regional hospitals

If organizations with the resources of HCA and UHS are actively fighting to recover revenue, consider what the same payer behaviors mean for hospitals without dedicated denial management teams, without years of accumulated analytics, and without the negotiating leverage to push back.

For community and regional health systems, the math is unforgiving. Denied and underpaid claims — particularly complex ones involving workers’ compensation, auto/MVA, veterans’ benefits, and government payers — require a different kind of expertise than standard commercial billing. These claims carry longer timelines, more regulatory complexity, and higher individual claim values. They also tend to fall outside the core focus of a hospital’s internal RCM team, which means they’re often underworked or left on the table entirely.

True AR days increased 5.2% year-over-year in 2024, driven by rising request-for-information denials and slower payer responses. Industry benchmarks suggest AR over 90 days should represent less than 15–20% of total receivables, yet average performers now hover closer to 36%. These numbers represent real margin erosion happening across the industry.

The case for specialized support

What HCA and UHS are signaling is that revenue recovery requires deliberate, sustained effort. The health systems winning this fight are investing in specialized capabilities: dedicated teams, purpose-built technology, and deep payer intelligence.

That’s the model Revecore was built around. For more than two decades, we’ve focused exclusively on the complex, specialty claim categories that demand deep expertise — denials and underpayments, complex claims, workers’ compensation, VA, and Medicaid eligibility and enrollment. Our clients don’t have to build that infrastructure internally. They get access to a team that works these claim types every day, backed by our AI-powered platform built to surface opportunities, automate workflows, and accelerate resolution across the revenue cycle.

When UHS talks about AI solutions yielding improvements in denials management and revenue capture, they’re describing outcomes our clients are achieving as well, without having to deploy and manage those capabilities in-house.

The bottom line

Payer pressure is intensifying. The organizations that will come out ahead are the ones that stop treating complex claims recovery as a back-burner item and start treating it as a strategic priority.

The largest health systems in the country have already made that call. For hospitals and health systems still building toward that level of investment, a specialized partner can close the gap — and start recovering revenue that’s already been earned.