FW: Healthcare Industry Insights: Revenue Cycle Management (RCM) Industry Update

William Blair
James Thornton
Partner
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LorientCapital
Miami, FL | Birmingham, MI
www.lorientcap.com
From: Ryan Daniels - William Blair <rmail@williamblair.com>
Sent: Monday, November 24, 2025 4:15 PM
To: James Thornton <james@lorientcap.com>
Subject: Healthcare Industry Insights: Revenue Cycle Management (RCM) Industry Update
William Blair
Equity Research
Healthcare — Healthcare Technology
Ryan Daniels, CFA
+1 312 364 8418
rdaniels@williamblair.com
Jared Haase, CFA
+1 312 364 5135
jhaase@williamblair.com
Healthcare Industry Insights: Revenue Cycle Management (RCM) Industry Update
Industry Insights is our newest research product, where we review recent data points (channel conversations, competitor calls, industry reports, survey work, regulatory updates, etc.) related
to various subsectors within our healthcare services, healthcare delivery, and HCIT coverage universes.
Highlighted/Relevant Companies Related to This Edition of
Industry Insights: Providers that sell into the health system and healthcare provider RCM market, such as
Waystar (WAY) and Phreesia
(PHR), and leading public and private operators in the
revenue cycle management (RCM) and
patient payment space.
RCM Industry Update: In this
Industry Insights, we highlight a recently released report from MDaudit (downloadable
via this link), which analyzed year-to-date payer claims and audit data from the company’s network of more than 1.2 million providers and 4,500 facilities (and more than $20 billion in annual charges audited) in order to assess key trends in the
provider RCM space.
Key insights from the report include the following:
Payer denials remain a major RCM pain point for providers, with data indicating that overall claims denials are
up 14% in hospital outpatient settings and 12% in inpatient settings.
Payer audits are also on the rise, with the number of audited cases increasing by 30% in 2025 and the average value per audited claim up 18%.
Coding-related denials appear to be a particularly large burden for providers in 2025, with these denials up another 26% year-to-date following a roughly 125% increase in 2024.
The average claim value for a coding-related denial rose to $809 in 2025, versus only $632 in 2023, while the average denied amount for medical necessity/more information required rose to $450, up
from $249 in 2023.
In Medicare Advantage, the average denied claim increased markedly in 2025, with an average value of $1,000, compared with only $588 in 2023.
Moreover, for request for more information (RFI) and medical-necessity-related denials, the average denied amount in MA increased almost fivefold from $161 to $789 between 2024 and 2025.
Also of note, RFI and medical-necessity-related denial values increased by 60% in the professional setting, 28% in the hospital outpatient setting, and 123% in the inpatient setting in 2025. Here,
commercial payers drove a year-over-year increase of 176% in denied-claims-dollars, while MA plans increased 390% in 2025.
Total billed
charges that were audited related to clinical documentation errors increased nearly fourfold in
2025 from 2024. The report noted that payers “have been extremely diligent on documentation issues on medical necessity denials, driving healthcare providers to scramble to find ways to accelerate
the claim adjudication cycle or high-value claims.”
Even for claims that were not denied, the report indicates that the average “lag days” from submitting a claim to getting paid is also increasing, with the average lag at 39 days for inpatient claims
(up from 36 last year), 41 days for outpatient claims (versus 34 days in 2024), and 24 days for a professional claim (up from 15 days).
View
the Full Report
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