The EOB, which stands for Explanation of Benefit is the statement that your insurance company sends you to show what was and was not covered by your insurance. Explanation of Benefits can be broken down into several parts.
1. Provider, Patient, and Date of Service: I know this seems obvious, but make sure that the information is what you expect it to be. If you think it’s not call your provider first to verify and request that they contact the insurance company.
2. Services: this area is a short description of what you had done. This may include CPT and/or ICD-9 diagnostic coding. The main reason you would need this information is if you felt your claim did not pay correctly and you wanted to file an appeal. Also make sure you are being billed for the service you actually received.
3. Billed Amount: This is the actual billed charges from your provider.
4. The breakdown of what was or was not paid: This is expressed differently depending on your insurance company; however, the information used is still the same. After the billed amount will be information regarding what amount your insurance company allowed. This number will have to do with whether you saw a network provider and therefore received a discount or it may be based on usual and customary rates, depending on your plan.
Once the price that the insurance company is willing to pay (the allowed amount) is determined, next comes deductibles, co-payments, and co-insurance. The co-insurance may be expressed as “you pay this %” and “insurance pays this %” sections. This is your responsibility to pay and the actual amounts and terms will depend on your health insurance plan. These will be subtracted from the allowed amount.
5. Next will the amount that the insurance actually pays. This may or may not leave a zero balance. Often you will be responsible for co-payments, deductibles, and/or co-insurance. However, if you saw a provider or had a procedure that is not covered by your insurance then you may be responsible for the entire bill.
6. Remark Codes: If you have to pay any amount the remark code at the bottom of the EOB should explain why you are having to pay it. For example, remark code D1: patient pays co-payments and deductibles, or something to that effect. The one thing you have to understand is that these remark codes can be wrong–especially when a claim is denied payment. In the cases where you think it is wrong you will need to contact your insurance company or if they have online access to your information, go online and compare the EOB information with your benefit plan information. Remember, you always have the right to appeal.