Explanation of Benefits for Medical Insurance

The statement you receive from your insurance carrier is called Explanation of Benefits or EOB. The statement outlines the total amount you were charged by your provider, the amount applied towards your deductible, the discounted rate if a participating provider was used, the amount paid by your insurance carrier and the amount you owe.

You may see footnote numbers or letters next to the amount billed or paid. It is helpful to read the footnotes to better understand how your claim was processed. If, for example, you notice that the claims submitted were not paid, you may see a footnote that indicates the bill was applied to your deductible, the claim was a duplicate of services already paid by your carrier, or your insurance carrier is waiting for additional information from your provider.

Do you ever feel like your doctor’s office and insurance carrier are just submitting the same information over and over again in an attempt to bury you in paper?

The reason why you may receive multiple Explanations of Benefit statements for the same dates of service from your healthcare provider (your doctor’s office, for example) and insurance carrier is based on your right to be informed.

Based on this right to be informed, your healthcare provider must forward you a copy of any claim they submit to your insurance carrier. Your insurance carrier, in turn, must forward you a copy of any Explanation of Benefit they issue to your healthcare provider. This gives you the opportunity to review the claims and contest any charges that do not appear correct.

A "tracking" number is associated with each EOB. This will allow your insurance carrier to be able to easily access a specific EOB if you have a question regarding either their accounting or the charges submitted by your healthcare provider.

For my sanity’s sake, I make it a practice of putting my claims in a binder. On one side I place the claims waiting to be processed by my insurance carrier. As soon as I receive the Explanation of Benefits, I staple the claim to the EOB, write out my check and record the check number on the claim. Then I place the paired claim and EOB on the other side of the binder as "processed".

There are a lot of things in the medical industry that can drive you nuts, but, keeping track of your claims shouldn't be one of them! Remember to save your receipts for your income tax deductions!

How it works:

You come home from the hospital after your skiing accident only to find a stack of medical bills and Explanations of Benefits from your insurance carrier. As you go through the pile, you are able to pair up most of the claims issued by the providers with their claims. As you review each of the claims and what was paid, you see from the footnotes on the Explanation of Benefits that your insurance carrier has applied your deductible to some of the claims.

Everything looks okay until you stumble upon four claims from the durable medical equipment (DME) company that supplied you with your crutches, wheelchair and commode.

You see that there are four Explanation of Benefits statements for this provider from your insurance carrier. According to the footnotes, you see that your insurance carrier has not received information to support the need for both a wheelchair and crutches. As you review the DME provider’s claim you see some odd charges added on to the claim.

Their itemized claim not only includes charges for your crutches and commode but a hospital bed, and over-bed tray table as well. You also notice that the wheelchair isn’t just a wheelchair, it is a motorized wheelchair!!!! You contact your insurance company’s customer service representative to inform him/her of the problem. He/she informs you that he/she will follow-up with the provider for additional information.

A month later, you receive one more round of claims from the DME provider and an EOB from your insurance carrier. You see that the charges for the hospital bed and over-bed tray table have been removed and the request for a motorized wheelchair has been changed to a standard wheelchair. The Explanation of Benefits from your insurance carrier shows they have paid their portion. Now you know how much you owe and can pay the claim!

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