Make the Most of Your Coverage – How to Read an Explanation of Benefits

An Explanation of Benefits (EOB) is a statement sent by a health insurance company to explain what medical services and/or treatments were covered by a policy.

Unfortunately, they can be difficult to translate if you’re not fluent in medical coding. Explore our guide to learn how to read an explanation of benefits so you’re not leaving healthcare benefits on the table.

How to Read an Explanation of Benefits

Every insurance company has a different statement layout, but most will feature the following points of reference.

Service description

You’ll find a description of received health care services in this section. These could include medical visits, bloodwork, medications/vaccines administered in-office, or surgeries.

Provider charges

This is the total amount charged by the provider for your visit and their services.

Allowed charges

This amount will likely differ from what’s listed under provider charges. Insurance companies contract with providers for lower service charges. For example, your provider may charge $100 for a service but agree to charge Insurance Company A $30 and Insurance Company B $25.

Paid by insurer

This is the amount your insurance company paid to your provider.

Amount owed

This is most likely the first place you look on an EOB as it affects you the most. This is the amount you may owe your provider after your insurance company has paid your provider. If it’s higher than you anticipated, don’t panic just yet. You may have already paid for part of your total and this may not be reflected in your EOB. Instead, wait for a bill from your provider before making any additional payments.

Remark code

Your insurance company may need to explain more about your benefits and their payments. You can find additional information in this section.

What Do I Do If I Believe There’s an Error on My EOB?

While not ideal, mistakes can pop up on an EOB. In fact, the American Medical Association says nearly 20% of all EOBs contain errors. You have the right to contact your health insurance company with any questions or concerns you may have. When reviewing an EOB, make sure you:

• Doublecheck all listed services. They should match up with the actual procedures/appointments you received.
• Compare multiple EOB statements if they coincide. For example, if you went to your primary physician for a sore throat but were referred to a specialist after they ran a few tests, make sure the tests only show up on the EOB for your physician.
• Check non-medical related information, like your name, address, birthdate, and other contact information to make sure everything is current.

Contact the customer support department at your insurance company if you believe you were charged for services that should be covered under your policy or if you notice any blatant errors.

3 Things to Remember When Reading an EOB

An EOB can be intimidating, especially if you’re worried about what a trip to the doctor will end up costing you. But there are a few helpful tips we can leave you with.

1. An EOB is not a bill.

An EOB is never a bill. The total due shown on an EOB could be different than what your provider is expecting from you.

2. An EOB can be adjusted.

Mistakes can happen when an EOB is being filled out. If you do catch an error, it can be fixed. It is best to address any mistakes as soon as they are realized.

3. Help is always available.

If you just can’t seem to make sense of your EOB, you can always call a customer service representative for help. You’re not alone.

An EOB can help you learn more about your healthcare coverage, keep track of your medical journey, and detect medical fraud before it gets out of control. Understanding how to read an explanation of benefits helps protect your health and finances.