New Report Shows Surge in Denied Insurance Claims in Indiana

INDIANAPOLIS, IND. (WOWO) Indiana hospitals are reporting a growing financial strain as insurance companies delay or deny payments, even as patients face higher premiums and out-of-pocket costs. A new Payor Scorecard analysis found hospitals lost $717 million in 2025 due to unpaid claims and bad debt.

The report, based on data from 70 hospitals, shows nearly 13 percent of billed claims were initially denied, representing about $4.7 billion in delayed payments. While many of those denials were eventually overturned, hospitals were required to spend significant time and resources resubmitting and appealing claims to receive payment.

The Indiana Hospital Association estimates that if all hospitals statewide were included, total unpaid care could exceed $1.6 billion. Hospitals also reported spending more than $400 million in 2025 pursuing payments from insurers for services already provided.

The findings highlight a widening gap between what insurers collect in premiums and what providers are ultimately paid. Data shows patients are responsible for a growing share of costs, with nearly one-quarter of commercial claim expenses falling on individuals through deductibles and coinsurance. When those costs go unpaid, hospitals often absorb the losses.

The report also found that hospitals waited an average of 46 days for payment, with nearly 30 percent of claims taking more than 90 days to be reimbursed. Commercial insurers were shown to take significantly longer to pay than traditional Medicare, adding pressure to hospital finances.

Despite these challenges, hospital pricing in Indiana has declined in recent years, even as insurance premiums continue to increase. The analysis points to rising administrative hurdles, including frequent requests for additional documentation, as a major factor in delayed payments.

Healthcare leaders say the trends are contributing to financial strain for both providers and patients, with delays in care and increased costs affecting families across the state.

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