Explaining the EOB

Featured Article, Power to the Patient
on July 22, 2013

If you’ve ever handed over your insurance card at a visit to your doctor’s office, you’ve gotten an EOB—explanation of benefits—in the mail afterward.

“You get these forms, and it looks like it could be a bill,” says Ankeny Minoux, chief operating officer for the Foundation for Health Coverage Education.

But an EOB, which is mailed to patients by their health insurance companies within a few months of receiving a healthcare service, is not a bill. And while “explanation” is part of the name, EOBs aren’t exactly easily understood.

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“It’s a lot of numbers, and it’s a lot of fields,” says Erin Moaratty, chief of external communications for the Patient Advocate Foundation.

As tempting as it may be to pitch the EOB into the trash or leave it unopened in a stack, it’s better to open it up and at least try to decipher the information within. And if you look more closely, the EOB may start to make a little more sense.

The forms should spell out a description of healthcare services that you recently received, along with coding you don’t need to understand but the provider and insurance company do. It will list when the service was provided and which provider performed the service.

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The EOB will also list the amount charged and requested by the healthcare provider for the service, as well as the portion of that amount your insurance company will cover. In that regard, it may resemble a bill, but it isn’t. “It’s just alerting you to what you will probably be subjected to,” says Moaratty.

Essentially, EOBs are just statements of the situation as currently documented by your insurance company, the Patient Advocate Foundation stresses. As such, the EOB can change as your insurance company gets more information from your provider. So don’t be alarmed if you get a second EOB that details the same services provided—it likely contains updated information.

When you do receive a bill from your healthcare provider, you should compare your latest EOB to the bill and see if everything matches up. If it doesn’t, you’re worried there’s been a mistake, or if you have other questions about services and billing, start by calling the provider at the phone number on your bill, says Minoux.

“Take your EOB and staple it to the bill you get,” says Moaratty. “Write on it what you paid and when you paid it, and you have a track record of what’s going on.”

Don’t throw the EOBs out, either. If you get an EOB without a follow-up bill, don’t assume you won’t have to pay—the insurance company can take as long as seven years to send you a bill, Minoux cautions.

“So having that paperwork is so important,” she says.

If you ever need to undergo treatment for a major illness or chronic condition, you will probably get a lot of EOB statements in the mail. Moaratty suggests creating a system to file and organize them so you won’t lose track. You might even designate a loved one to help you when you’re not in shape to organize them yourself.