Healthcare organizations can spend months identifying, appealing, and recovering denied or underpaid claims. The financial consequences do not remain inside the revenue cycle. Delayed payments, reduced reimbursements, unresolved adjustments, and aging exceptions eventually reach accounting, where teams must determine what was collected, what remains recoverable, and what should be reflected in the general ledger.

The scale of that burden is significant. The American Hospital Association estimates that hospitals spent nearly $18 billion overturning claim denials in 2025 and $43 billion trying to collect payments insurers owed for care already delivered. At the same time, hospitals faced higher labor, drug, supply, and technology costs. When incoming revenue is delayed or lower than expected, finance leaders need a timely, defensible view of the effect on cash, revenue, reserves, write-offs, and the bottom line.

That is where the connection between revenue cycle management and the financial close becomes critical.

Denials and underpayments create different problems.

A denial occurs when a payer rejects all or part of a claim. It usually creates a visible balance and a defined process for correction, resubmission, or appeal. The provider may ultimately recover the payment, but the timing and amount remain uncertain while the claim is unresolved.

An underpayment can be harder to spot. The payer processes the claim but reimburses less than the amount the provider expected under the applicable contract or payment rules. Some underpayments may sit in accounts that appear resolved, which makes small discrepancies easy to overlook across a large claim population.

These issues also have different causes. Denials may stem from eligibility, authorization, coding, documentation, medical necessity, or filing requirements. Underpayments may reflect contract interpretation, incorrect rates, missed modifiers, payer processing errors, or internal billing errors. Revenue cycle management systems and specialists are designed to address those causes by preventing denials, validating reimbursement, managing appeals, and supporting recovery. As MEDTEAM Solutions explains, effective revenue leakage management depends on disciplines such as contract management, accurate patient access data, denial tracking, and focused underpayment review.

The financial close sees the downstream effect

By the time a denial or underpayment reaches accounting, the operational question has changed. Revenue cycle teams may be asking why the payer did not reimburse the claim as expected and how to recover the balance. Accounting must also ask whether related cash, receivables, contractual adjustments, allowances, reserves, write-offs, and revenue have been recorded correctly.

That becomes difficult when data is spread across patient accounting platforms, RCM systems, clearinghouses, banks, payment portals, spreadsheets, and the ERP. A single patient encounter can generate activity involving primary and secondary payers, patient responsibility, adjustments, denials, underpayments, refunds, and write-offs. If these records do not reconcile, finance may enter the close with an incomplete picture of revenue and cash.

The timing gap matters as much as the dollar gap. A denial can delay payment beyond the period in which the service was delivered. An underpayment can create a variance between expected and actual reimbursement. If either remains unresolved, accounting may need additional analysis to support accruals, estimates, adjustments, or write-off decisions. The result can be more manual work, late journal entries, and last-minute questions during close and audit review.

Why visibility matters to CRCOs and CFOs

For the chief revenue cycle officer and operations teams, earlier visibility helps prioritize the exceptions that require investigation. A high-value payer discrepancy, an aging denial, and a repeated short payment should not receive the same treatment as a routine timing difference. Teams need enough detail to sort exceptions by value, age, payer, account, or risk and route them to the right owner.

For the CFO, those operational exceptions affect confidence in reported financial position. Leadership needs to understand whether a variance represents a temporary collection delay, a recoverable underpayment, a valid contractual adjustment, or revenue that may need to be written off. That distinction becomes even more important when organizations already operate under cost pressure.

A recent AHA report found that Medicare reimbursed hospitals at 83 cents for every dollar of cost in 2024, producing more than $100 billion in underpayments. The same report found that total hospital expenses grew 7.5% in 2025. Those figures describe broad reimbursement and cost pressures, not individual claim variances, but they show why finance leaders cannot afford weak visibility between revenue activity and the ledger.

Where financial close automation fits

Financial reconciliation and close software’s role begins where high-volume revenue activity must be reconciled to the financial records used for reporting.

A financial reconciliation and close solution can bring payer payments, remittances, adjustments, patient payments, bank activity, and ERP data into a controlled process. Automated transaction matching can compare records at scale and surface exceptions for review. Structured workflows can then assign ownership, preserve supporting documentation, and track resolution before issues create surprises at month-end.

In practice, healthcare finance teams can use this layer to:

• Match payer payments and remittance activity to expected reimbursement and general ledger records.
• Reconcile patient payments across portals, point-of-service systems, cards, checks, banks, and patient accounting systems.
• Surface unmatched payments, underpayments, denials, aging balances, and other exceptions for investigation.
• Reconcile contractual allowances, adjustments, and write-offs to the underlying payer, patient, and accounting activity.
• Standardize controls, approvals, documentation, and close workflows across facilities and legal entities.

Trintech matches financial transactions and identifies discrepancies, connecting payment and adjustment data to reconciliation and close. An integrated approach gives revenue cycle and accounting teams a shared view of the exceptions that affect reported revenue.

A practical operating model

Technology is most useful when responsibilities remain clear. Revenue cycle teams should continue to own claim prevention, coding and billing accuracy, contract validation, appeals, and recovery. Accounting should own the integrity of the ledger, reconciliations, journal entries, close controls, and financial reporting. Both teams need a defined handoff for unresolved items.

That handoff should answer a few basic questions: Which exceptions require revenue cycle action? Which items affect the current close? What documentation supports the accounting treatment? Who owns the next step? When should an unresolved balance be escalated, adjusted, reserved, or written off?

A shared exception workflow can reduce the time spent collecting answers through email and spreadsheets. It also creates a clearer audit trail showing the source data, the variance, the assigned owner, the supporting evidence, and the final resolution.

From revenue leakage to reporting confidence

Healthcare providers cannot eliminate denials and underpayments through financial close automation. They can, however, reduce the risk that the downstream effects remain hidden until late in the close.

When revenue cycle data is reconciled with cash and the general ledger, CRCOs and operations leaders gain earlier visibility into exceptions that need attention. Controllers gain a more controlled process for adjustments and write-offs. CFOs gain greater confidence that reported revenue and financial position reflect what the organization collected, what it still expects to recover, and what may be at risk.

For healthcare organizations balancing reimbursement pressure with rising labor, property, supply, drug, equipment, accrual, and depreciation costs, that visibility is essential. The goal is not to turn the financial close into another claims system. It is to ensure that the outcome of the revenue cycle is accurately reflected in the books.