Understanding Medical Insurance: Explanation of Benefits

If you have health insurance, when you go to the doctor or hospital, your healthcare provider will submit a claim or bill for services provided to your insurance company. Your medical insurance company will then pay part or all of the services you received (depends on your plan). In some states, the insurance provider may send you a check so you can pay your doctor. In either case, once your claim is processed, your health insurance company will send you an Explanation of Benefits (EOB) which clarifies your payment responsibility or reimbursement. To clarify, the EOB is not a bill just a detailed explanation of what your insurance paid to the doctor and a explanation of what you may owe. Typically, if any balance is remaining after (shown on) EOB, your doctor usually send you a bill. Understanding how to read an EOB is important.

1. Member
Policy Member; employee, person who obtained insurance.
11. Service Date
Date you were helped or date you received services
2. Member ID/Subscriber ID
This is the number the insurance company identifies you
12. Service Description and Procedure Code
This describes the procedure you received and the code to identify procedure
3. Group Name/Plan Sponsor
This is the employer or the organization offering health insurance
13. Amount Billed
What your healthcare provider billed your insurance provider
4. Group ID or Plan
Insurance provider documents which plan you received (e.g. HMO/PPO)
14. Amount Paid
The amount your insurance paid
5. Claim #
The number the insurance provider assigned to claim if you have questions
15. Non-Covered
The amount your insurance did not cover of the procedure. You are responsible for this amount.
6. Patient Responsibility
What amount you owe the hospital, doctor's office (healthcare provider)
16. Deductible
Amount you must pay for covered services each year before your insurance pays. You are responsible for this amount.
7. Amount We Paid
The amount your insurance paid
17. Co pay/Co-Insurance
Under your plan, the predetermined amount you are responsible for (co payment) or the % you are responsible for (coinsurance)
8. Amount Billed
What your healthcare provider billed your insurance provider
18. Notes/Remark Code
Sometimes the insurance provider will put a remark to let the patient know why a certain item was not covered
9. Provider Preferred
Whether the healthcare provider you used was in or out of your Plan
19. Date Paid:
The date the insurance provider sent payment to your healthcare provider
10. We Paid (Provider Paid)
Identifies what provider (doctor or hospital) was paid or who made the claim
20. Negotiated Savings
Not present on this EOB, but the discount your insurance provider receives as part of their contracts with the healthcare provider


What Happens Next? What if I Cannot Pay The Amount I Am Responsible For?

Any amount you are responsible for, as told by your insurance providers EOB (Explanation of benefits), will be sent to you as a bill from your medical provider. This bill is often called a "Billing Statement." If you realize that you cannot pay your bill coming to you then negotiation may be your next step. You can either negotiate further with your healthcare provider for the charges due, or you can work with medical debt specialists who will negotiate for you. Negotiation itself is not difficult, what is difficult is being able to effectively review, audit, and compare your procedure charges to national average and local averages. Therefore, it is best to work with a medical debt relief specialist. Sign up now for a free consultation where we will review and audit your medical bills with no obligation to use our services. If you decide to use our services, our service comes with no risk as fees are only a percentage of savings obtained (if no savings, no fee).