Editor’s note: This blog was written with the help and insight of Sakti Bagchi, a senior manager of development for our Ventus business unit.

It should probably go without saying, but I want to say it anyway: Claims denials cost healthcare organizations real money. While obvious, it’s a fact that cannot be overlooked. When organizations lose this money, other key aspects of their daily operational success can be put at risk.

Such denials have been and will likely always be a frustrating pain point across the industry, from smaller practices with one or two doctors, to bigger health systems that span multiple disciplines. Many believe denial management is just administrative cleanup, but both industry data and real-life experience show that the causes—and the solutions—run much deeper.

Drawing from candid conversations with denial management experts, direct user feedback and hands-on healthcare leadership, I want to address the most common myths about denials, why they can be persistent issues to manage and what truly moves the needle for denial reduction.

Many believe denial management is just administrative cleanup, but both industry data and real-life experience show that the causes—and the solutions—run much deeper.

Myth 1: Most denials are unavoidable

Reality: Many denials are in fact preventable. Common causes include missed authorizations, eligibility verification mistakes, inappropriate (or incorrect) coding and missing documentation. Here’s a striking insight from an industry leader: “When I talk to executives, many assume denials simply can’t be avoided. But if you ask the people who have to appeal those denials, the frustration is clear—they’re fixing the same problems over and over because the root causes don’t get addressed.”

Proactive process improvement—such as timely eligibility checks, robust documentation workflows and ongoing monitoring—can reduce denial rates dramatically.

For a closer look at a real-world example, one hospital lost $300,000 in a single year due to inadequate education around PSA test ordering and diagnosis coding. After implementing cross-team education and root cause analysis, the hospital recovered nearly $168,000 the following year.

Myth 2: Only clinical errors cause denials

Reality: Administrative errors—not just those of a clinical nature—are a leading cause of denials. Duplicate claims, missing prior authorizations, incorrect eligibility capture or failure for accurate documentation can outnumber pure clinical coding issues. Effective denial management means targeting both administrative and clinical workflows to minimize avoidable denials.

Myth 3: Denials are all the same

Reality: Denials are highly variable. Some relate to coding (such as bundling and DRG downcoding), others to failed processes (like missed authorizations or retroactive eligibility) and still others result from payer-specific policies or breakdowns in internal communication. Recognizing these nuances is key to prioritizing resources where they have the greatest impact.

Myth 4: All denials are worth appealing

Reality: This is a tricky one. Not every denial should be appealed. Smart denial management requires prioritizing appeals based on net revenue potential and the likelihood of overturning the denial. Chasing every small dollar or unrepeatable denial wastes precious resources. As much as it may seem like a viable and prosperous course of action, some denials might be better off untouched.

Myth 5: Technology alone fixes denials

Reality: This is a big one for us to ponder at Altera Digital Health. And, yes, while technology is essential in aiding organizations in denial management and reduction, it is not a “silver bullet.” The best results come when technology complements strong processes and ongoing staff education—not when it replaces them. Many organizations install advanced tools expecting instant fixes, but experts stress that unless the root causes are addressed and knowledge is shared organization-wide, denials will persist. Investing in new systems needs to be paired with systematic root cause analysis and a commitment to communication and education.

Almost all tools help you track denials and even generate appeal letters. But if you just focus on the tool, without looking for the underlying problems and educating the teams who impact those problems, denials will keep coming and you’ll run in circles.

The bottom line and upward momentum

As I said above, reducing denials isn’t about chasing every rejected claim. It’s about separating myth from reality, closing the loop on education and feedback, and focusing your organizational energy in the right places—where it counts the most. Prevention through better processes, smart automation, robust analytics and relentless education outperforms any software alone.

By continually analyzing denial patterns, prioritizing high-value appeals and building a culture of collaborative feedback, healthcare organizations can unlock substantial hidden revenue and reclaim money that would otherwise slip through the cracks.

A prime example of technology that can help complete the loop of success for any financial team is Ventus Contract Management. At a glance, it helps clients save a lot of money by reporting payment variances and lesser pay, which helps identify root cause and address the denials effectively. Now supercharged with AI for best-in-class contract comparisons, we are building on our existing capabilities, leveraging leading-edge AI alongside Ventus Contract Management’s precise predictive analytics to deliver even more accurate revenue forecasts and insights.

The solution provides users with insight and clarity that can help ensure that the myths listed above can actually stay mythical. Learn more here.