What Is a Good Clean Claim Rate — and How to Hit It

Did you know that nearly 12% of healthcare claims were denied in 2024?

Yes, the Healthcare Financial Management Association (HFMA) reported this, showing the gap between claims that are being submitted and the claims that should have been paid.

But the story doesn’t stop there, because every claim that is denied needs correction, resubmission, or an appeal, creating a lot of administrative work. And another report by the HFMA stated that healthcare practices spend around $25 billion unnecessarily on this.

Upon digging deeper into this problem, one thing clearly stood out in my research. You see, the problem with denied claims was not when they landed in your billing queue. The problem with most of these denied claims started much earlier, such as with eligibility issues, incorrect patient information, or a coding error, and the list goes on.

With regard to this, CAQH estimates a $11.7 billion potential savings opportunity from automating eligibility and benefit verification. The report further states that automating claim submission can lead to potential savings of $2.468 billion.

Having said that, there is actually a very simple solution to reduce your practice’s claim denial rate — submit clean claims.

You see, catching problems before submission can be not only cost-effective but also reduce a lot of administrative work, rather than fixing them after they are denied.

And that is where your clean claim rate becomes important; it is hard to ignore. But what exactly is a clean claim rate?

Well, the industry standard says anything above 95% is a good clean rate, but the national average sits between 75% and 85%. And that is exactly why healthcare practices are looking for the best medical billing services to help them improve their clean claim rate.

On that note, in this blog, let’s see what it takes to get a good clean claim rate for your practice.

So, without further ado, let’s get started!

What Is a Good Clean Claim Rate?

Before we get into what you need to do, let’s first discuss what is considered a clean claim. Well, a clean claim is a claim that contains the right information, passes the required checks, and moves to reimbursement without anyone stopping it for a fix.

On the other hand, a clean claim rate is nothing but the percentage of your claims that pass on first submission of all the claims submitted. This gives your billing team a simple way to see how much rework they would have to do before claims even reach the payer.

How Do You Calculate Clean Claim Rate?

Use this simple formula to calculate your practice’s clean claim rate: Clean Claim Rate = Clean Claims ÷ Total Claims Submitted × 100

Let’s try to understand this with an example. For instance, if your practice submits 1,000 claims and 970 go through your defined pre-submission check without manual correction, your clean claim rate is 97%.

What Is a Good Clean Claim Rate?

There isn’t one percentage that is the clean claim rate benchmark for every practice. The definition of a ‘good clean claim’ can be different for every practice.

On top of that, your rate can vary depending on your specialty, payer mix, claim complexity, and how your practice defines and measures a clean claim. That is why comparing your rate with a number from other practices can be misleading if both practices measure two different things.

Now, the industry standard that is considered good is anything above 95%, as mentioned earlier. However, the more useful clean claim rate benchmark is the one based on your own historical performance and a clearly defined measurement method.

What Does Your Clean Claim Rate Tell You?

Your clean claim rate is more than another revenue-cycle KPI. It basically gives you an early look at the quality of your claim-submission process.

For instance, a high, stable rate generally means fewer claims need to be corrected before submission. On the other hand, a lower rate can point to recurring problems with patient information, eligibility, coding, authorizations, documentation, or payer-specific requirements.

In simple terms, the clean claim percentage tells you how often claims are going through cleanly, and your underlying claim errors tell you why they aren’t.

Clean Claim Rate vs. First-Pass Resolution Rate: What’s the Difference?

There are two terms—clean claim rate and first-pass resolution—that are quite confusing.

Now, these two terms are closely related, but they measure different stages of the claims process. The simplest way to see the difference is to look at when the measurement happens and what counts as success.

Here is a table to help you understand the difference in a better way:

A clean claim gives you a better starting point, but it doesn’t guarantee first-pass resolution. Clean claim rate measures how well you’re preparing claims, while first-pass resolution measures what happens to those claims after submission.

Now, it is important to track both, as it helps you see whether problems are happening before the claims are submitted or later in the revenue cycle.

What Causes a Low Clean Claim Rate?

A low clean claim rate usually isn’t caused by one single problem. In most cases, it’s the result of small errors entering the claims at different points in the billing process.

Here are some of the most common reasons that lead to a low clean claim rate:

• Patient and Insurance Data Errors: Incorrect patient demographics, member IDs, insurance details, or payer information can cause a claim to fail validation before it moves forward.

• Coding and Modifier Errors: Incorrect diagnosis or procedure codes, missing modifiers, or incompatible code combinations can prevent a claim from passing required edits.

• Missing Authorization or Referral Information: When a service requires prior authorization or a referral, missing or incorrect details at submission can keep the claim from moving forward cleanly.

• Incomplete Claim Information: Missing provider details, diagnosis codes, procedure information, or other required fields can result in an incomplete claim that needs correction before submission.

• Payer-Specific Requirements: Different payers can have different billing, formatting, and submission rules. A claim that passes one payer’s requirements may still need changes to meet another’s.

How Can You Improve Clean Claim Rate in Medical Billing?

Now, the crux of this blog is: ‘how to improve clean claim rate in medical billing?’

Well, let’s get one thing clear, improving your clean claim rate does not mean fixing more claims after they fail or even fixing a claim after it is denied. In fact, it is about those checks done earlier in the billing process so that common problems are caught before submission.

Here are some of the tried and tested methodologies to improve clean claim rate:

• Strengthen Front-End Eligibility and Data Verification: Start with the information that enters your system first. Then verify that it includes patient demographics, insurance details, coverage, and payer information before the claim is created. When registration errors are corrected at the source, they are less likely to follow patients through the rest of the billing process.

• Improve Coding and Documentation Accuracy: A clean claim depends on accurate coding, which is backed by appropriate documentation. That is why it is important to ensure diagnosis and procedure codes, modifiers, and other claim details are supported by the clinical records and that the coding workflows stay aligned with current billing requirements.

• Use Pre-Submission Claim Scrubbing: Don’t wait for the payer to identify an error. Run claims through pre-submission checks to catch missing, inconsistent, or invalid information before they leave your system. Where appropriate, these checks should also account for payer-specific requirements.

• Monitor and Review Claim Errors: Your clean claim rate tells you how often claims are going through cleanly. On the other hand, your error data tells you why they aren’t. Track the recurring issues by payer, provider, specialty, or claim type to identify patterns. Once done, use the targeted reviews to address the problems creating the most rework.

How Can Outsourcing Help Practices Achieve a High Clean Claim Rate?

One of the best ways to achieve a high clean claim rate is by outsourcing your medical billing. With dedicated billing expertise and structured processes for catching claim issues before submission, outsourcing can help you achieve a clean claim rate.

So, next time you are looking for an answer to the question, ‘How to achieve a high clean claim rate?’ then you know the answer is outsourcing, and here is how:

• Dedicated Billing Expertise: Experienced billing teams focus on claim accuracy, coding checks, and submission quality. This reduces the burden on in-house staff.

• Consistent Pre-Submission Checks: Standardized workflows help identify missing information, coding issues, eligibility problems, and other common errors before claims are submitted.

• Payer Requirement Management: Billing teams can account for payer-specific billing and submission requirements, helping prevent avoidable errors across different payers.

• Ongoing Performance Improvement: Tracking recurring claim errors by payer, provider, or claim type helps identify patterns and improve the billing process over time.

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