The rate of payer audits accelerated in 2025, with hospital inpatient and outpatient average denial amounts that increased by 14 and 12 percent, respectively.
Denial volumes were also up overall, led by a nearly fivefold increase in Requests for Information (RFIs) and medical necessity denials for Medicare Advantage (MA) plans. The total at-risk amounts, number of claims, and average amount per claim increased by 30 percent in payor audits. Denials related to outpatient coding increased by 26 percent.
These are just a few of the trends identified in the 2025 MDaudit Benchmark Report, a comprehensive examination of real-world claims and audit data representing the first three quarters of 2025. The findings of this year’s report send a clear signal to providers that successfully navigating today’s complex financial and regulatory landscape requires prioritizing billing compliance, coding integrity, and robust denial prevention strategies, while redefining revenue integrity to ensure sustainability.
The central theme of the 2025 report is the evolution of revenue integrity from a defensive stance to a proactive discipline that unites charge capture, coding, billing compliance, and denials management within a connected, data-driven framework. The analysis clearly demonstrates the urgency of adopting a unified approach to billing compliance, coding integrity, and denial prevention: a strategy that leverages data intelligence and automation and is shared across revenue functions, enabling finance leaders to shift from managing crises to protecting revenue with foresight and confidence.
Four key takeaways emerged from the data, trends that provide a roadmap to guide actions that revenue integrity, billing compliance, and coding teams must take now to safeguard income and manage risk. These insights indicate where attention, investment, and process improvement are needed as we enter a new year.
1. Rising Denial Rates
The upward trajectory of denial volumes and amounts signals the need for providers to sharpen denial prevention strategies. In 2025, the average denied amount for hospitals rose from $4,730 the year before to $5,390 (a 14-percent rise) in outpatient settings, and from $504 to $565 (12 percent) in inpatient settings. This includes a 70-percent increase in average denied amounts from RFI and medical necessity denials across all settings. Telehealth-related denials were up 84 percent in 2025, due primarily to missing information, errors in claim submission, non-covered charges, or duplicate claims.
To reverse these trends, provider organizations need to monitor denial rates by payer, setting, and claim type, and reinforce root-cause analysis of denials, including coding, documentation, and charge capture. Investing in early-warning tools and audit workflows that catch high-risk claims before submission is also recommended.
2. Payer Audit Increase
External payer audits surged again in 2025, with total at-risk amounts and audit cases per customer rising by 30 percent and the average amount at risk per claim growing by 18 percent. Of the top payor types, 45 percent of the at-risk amount was driven by commercial payers, while Medicare and Medicaid accounted for 28 percent. The average at-risk amount for a payor audit in a hospital setting was approximately $17,000, whereas the average at-risk amount at a professional setting was $1,172.
Intensified payer scrutiny necessitates faster response times, stronger documentation, and proactive risk management. This can be accomplished by mapping current audit exposure by payor, audit type, and service line, and prioritizing the highest dollar-at-risk claims for review and remediation. Providers should also implement robust workflows to manage audit requests, capture documentation, and respond within deadlines to retain revenues.
3. Outpatient Coding Worsens
Outpatient coding-related denials increased in 2025, rising 26 percent after a 126-percent spike in 2024, signaling their critical vulnerability. To slow this escalation, providers must begin treating coding integrity as a foundational risk area, rather than an afterthought. This includes conducting targeted risk-based coding audits in outpatient service lines, focusing on training, review, and oversight of outpatient coding workflows, ensuring that coding tools, documentation support, and coder oversight align with heightened scrutiny, governance, and human oversight requirements.
4. Technology Unlocks Outcomes
There was a silver lining in the 2025 Benchmark Report: technology- and data-driven approaches are gaining traction and delivering measurable improvements, and revenue integrity teams are increasingly adopting data- and artificial intelligence (AI)-driven approaches to unlock revenue opportunities and mitigate risk. Risk-based audits within the MDaudit platform increased by 25 percent, and pre-bill audits increased by 30 percent.
Leveraging data-driven platforms and deploying real-time, continuous risk monitoring lets providers stay ahead of payers by better understanding real-time billing, coding, and payment trends. This, in turn, allows them to take proactive action to educate providers and coders while addressing other issues.
Technology – including the responsible integration of AI and real-time performance data shared across multiple functions – will continue to play an outsized role in driving competitive advantage and ensuring financial resiliency in the year ahead. Integration of autonomous coding, predictive audit sampling, and workflow automation is expected to expand across the industry. Meanwhile:
The 2025 benchmark data makes one thing clear: the margin for error in billing, coding, and audits has shrunk. Denials are rising, audits are intensifying, technology is becoming a differentiator, and outpatient coding is a major emerging weakness.
Organizations that adopt analytics, proactive audit/pre-bill workflows, and coding integrity will have a distinct advantage.
The Medicare audit landscape has undergone a fundamental transformation, evolving from ad hoc enforcement practices to scientifically rigorous methodological frameworks. This evolution spans two critical
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