Why Is an Explanation of Benefits Important?

Health insurance plays an integral role in the well-being and lifestyles of you and your family. The right policy can open up access to essential preventive services, including checkups, screenings and immunizations, as well as health care like prescription drugs and necessary procedures. However, understanding your coverage and its exact parameters can be a complicated and even intimidating task. That’s why health insurance companies provide a key resource: your explanation of benefits (EOB).

What Is an EOB?

EOBs are documents provided by health insurance carriers after you’ve used your plan to access health care products or services. This correspondence is not a bill but a detailed overview of how your coverage applied to your care. Specifically, your EOB should include the following information:

• Patient details—This lists the name of the patient who received medical care.
• Provider information—This part of your EOB includes information about the provider you or someone else on your policy visited.
• Service description—This section is composed of details regarding the services, procedures or products provided.
• Charges—This is the total amount billed by the provider for care.
• Allowed amount—This is how much your insurer deems to be reasonable for what the patient received. If less than what you’ve been charged, you may have to pay the difference.
• Insurance payment—This is how much your coverage is contributing toward the services or products received.
• Patient responsibility—This lists how much you owe, including your deductible, copayments and coinsurance.
• Additional remarks—This includes any miscellaneous information or additional notes, such as reasons for claim denials.

Why Are These Documents Important?

EOBs are critical because they may help you understand how your coverage works and identify potential mistakes or miscalculations. If you’ve been billed incorrectly, your EOB can help you identify such errors and set things straight. You should save all EOBs, as they can help with tax documentation regarding medical expense deductions. Additionally, reviewing your EOBs may help you identify patterns and make adjustments to your coverage to ensure you have an optimal health plan.

We’re Here to Help

Contact 314 Insurance Advisors in La Grange, KY, today to learn more about EOBs and health coverage.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.