Each time you present your insurance card for payment at a health care provider, you’ll receive an Explanation of Benefits (EOB) in the mail from your insurance carrier.
An EOB describes how the provider and carrier are processing your claim. While an EOB is NOT a BILL, it breaks down your share of the cost. Think of it as a "preview of the bill you can expect" from your health care provider.
If you have a Health Savings Account (HSA), keep your EOBs! They can be used for HSA receipt documentation.
Start at the Top
At the top of your EOB, you’ll find contact informations for all parties involved in the claim:
- Your insurance company (note their hours, in case you have questions)
- Your health care provider
- You (it’s a good idea to review this area, just to make sure everything is correct)
Review Your Charges
The main body of the EOB is a table with a list of charges for services you received. The table will show each service listed by date, and the total charge for that service. A more simplified EOB will break up costs in sections (Your Responsibility, Health Care Provider Information).
Understanding the Terminology
The Date of Service is self-explanatory. If you’ve received a single EOB for a series of treatments or office visits, the date range may be listed in the table header, along with your name and account number.
The Service Description is the name of the service you received (e.g., “Medical Care”).
The Amount Billed is the total cost of that service.
The Allowed column or Discount Amount is an amount your service was discounted, if applicable, for seeing a provider within your insurance network.
Your Copay or Copayment is the amount you paid at the time of service.
The Deductible, if it appears, is the annual amount you pay before your plan will cover a certain service. Your deductible may not apply to every service; this is why you won’t see it on each EOB, claim, or other statement you receive.
If your plan didn’t cover some or all of a charge, you’ll see it in a Not Covered column.
You may see a Reason Code, if a charge or part of a charge was denied or not covered. Reason Codes start with CO, CR, or PR, depending on the type.
The Benefit Amount or Percent Covered, which usually appears as a percentage, is the amount of a charge your insurer has covered.
The Payment Amount is the same amount in the Percent Covered column, expressed in dollars. Think of it as the part of your tab the insurance company has picked up.
Finally, Your Responsibility, Due from Patient, or Amount You Owe is the amount you will pay when you receive a bill from your healthcare provider.
If all of the above looks okay to you, great! All you have to do is wait for your bill. If you have questions, want to question a Not Covered item, or see that a charge was declined by your insurance company, keep reading.
Codes and Claims Assistance
If you received inpatient, outpatient, or complex health care services, you’ll see the following additional codes on your EOB:
- ICD-9 codes: numerical diagnosis codes from the International Classification of Diagnoses
- CPT codes: 5-number codes for physician-performed services
- HCPCS (“hicks-picks”) codes: alphanumeric codes for medical goods and services
- Revenue Codes: 4-digit numbers attached to the use of hospital supplies
If you have a question about a charge, covered or not, note the code that accompanies that charge. When you call your provider or insurance company, using the code can help you specify the part of the EOB you want to address.
Retain Your EOB
An Explanation of Benefits is an important part of your healthcare records. At a minimum, keep it until your bill is paid and your claim is settled. But, keep in mind, you may need to keep it longer as part of your tax records.
An EOB contains your Protected Health Information, so if you do throw it away, take steps to protect your sensitive information.