Understanding your EOB

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Even those of us in the medical industry can be confused when we receive statements from our insurance companies. If you have questions about your Explanation of Benefits (EOB), hopefully the information below will help. If it doesn’t, you should contact your insurance company for a better explanation.

Vocabulary

Here are some commonly used terms on EOB statements:

• Explanation of Benefits (EOB): A form sent to a member by a health plan which explains the action taken on a claim and gives information about any payment, denial or member responsibility.
• Benefit: A service provided to a member that a health insurance plan will pay for. Also, a payment provided for covered services.
• Allowed Amount: The insurance company’s contracted rate for a covered service.
• Adjustment or disallowed amount: The difference between what a medical provider charges and the allowed amount. This cannot be billed to a patient; it is written off by the provider.Here are terms for the out-of-pocket costs you pay for your eligible medical services:
• Deductible: The amount you must pay for eligible medical services each year before your insurance plan begins to pay its share.
• Copayment or copay: The fixed amount you pay each time you have an office visit, a prescription filled or a hospital service.
• Coinsurance or co-ins: A percentage you pay of the total cost of a medical service. Co-insurance often applies after you’ve met your deductible for the year. For example, if your insurance plan has an 80% coinsurance, they will pay 80% of the allowed amount and the patient has to pay 20%.

EOB Examples and Other Resources:

• Asuris Glossary of Insurance Terms (PDF)
• Anthem Blue Cross Blue Shield EOB guide (PDF)
• Premera: Understanding your EOB
• First Choice Health: EOB example (PDF)
• Lifewise: How to read your EOB (PDF)
• Uniform Medical Plan: EOB example (PDF) and How Billing Works
• Medicare: How to read your Medicare Summary Notice
• Community Health Plan of Washington Glossary of Terms
• Regence Blue Shield: How to Read an EOB
• Providence: How to read your EOB
• Cigna: Explanation of Benefits
• Aetna: EOB example
• About.com article: Reading Your Payer’s EOB – Explanation of Benefits
• eHow.com article: How to Understand an Insurance Explanation of Benefits