Understanding what your insurance covers and what you must pay for health care can be confusing. But it’s important to know what to expect financially when you need to go to the doctor.
Path to improved wellness
After you visit your doctor, your doctor’s office submits a bill (also called a claim) to your insurance company. A claim lists the services your doctor provided to you. The insurance company uses the information in the claim to pay your doctor for those services.
When the insurance company pays your doctor, it might send you a report called an Explanation of Benefits, or EOB. This will show you what the insurance company did when it received your doctor’s bill (claim). You need to be able to read and understand the EOB to know what your insurance company is paying for, what it’s not paying for, and why. An EOB is not a bill.
Your doctor’s office might send you a statement. A statement shows how much your doctor’s office billed your insurance company for the services you received. If you receive a statement before your insurance company pays your doctor, you do not need to pay the amounts listed at that time. After your insurance company pays your doctor, you may need to pay the doctor any balance due.
Keep in mind that not all insurance companies send EOBs, and not all doctors’ offices send statements. You may receive one or the other or both.
Things to consider
See below for examples of an EOB and a billing statement. These explanations will help you understand each part of the documents. You should use what you learn to review your EOBs and billing statements carefully. Here are some things to look for:
- The dates of service and description of services on your EOB and billing statements should be the same. They should match other records you may have of the visit. If they don’t, contact your doctor’s office first.
- If you have questions about why your insurance company did not cover something or about the amount you have to pay, contact your insurance company.
- If more than 60 days have passed and your insurance company still hasn’t paid your doctor, contact your insurance company.
Finally, you should keep your EOBs and statements organized (for example, filed by date). This way you can access them easily should questions arise.
Explanation of Benefits
An example
On Jan. 13, 2018, Mary Jones took her daughter Ann to see James Ellis, MD, at his office. In addition to the office visit, Dr. Ellis’s practice provided Ann with an immunization and a blood draw. The sample EOB shows how the Jones’ insurance company, Healthway, handled the claim submitted by Dr. Ellis’s office.
Mrs. Jones has obtained her insurance through her employer, Bayview Industries, so she is the Member, and her employer is the Plan Sponsor. Ann is the Patient, since it is she, not Mrs. Jones, who received the services from Dr. Ellis. The Plan, O2BNAPPO, indicates Mrs. Jones is in the Preferred Provider plan. This is Claim 01.
Billing statement
Dr. Ellis is listed as the Provider, and Jan. 13 is listed as the date of service, since this is the date that he saw Ann. Dr. Ellis charged the insurance company $60 for the office visit, $10 for administering the immunization, $90 for the vaccine itself, and $25 for the blood draw.
The Negotiated Savings shows that Dr. Ellis has agreed to accept $50 for the office visit (the $60 charge minus $10 negotiated savings) and $20 for the blood draw (the $25 charge minus $5 negotiated savings).
The insurance company does not cover immunizations, so those related charges ($10 and $90) are listed under Charges Not Covered with a Remark Code to this effect. Both the office visit and blood draw are covered, so the amount listed under Charges Not Covered is $0 for both of those.
Mrs. Jones’s plan requires a $15 co-payment for all office visits, so the EOB shows that she owes $15 for the office visit.
The Total Payable column shows that the insurance company owes Dr. Ellis $55: $35 for the office visit ($50 – $15) and $20 for the blood draw. A check in this amount was issued to Dr. Ellis on Feb. 20. Mrs. Jones owes $115 (the $15 co-pay for the office visit, plus $10 for the noncovered immunization administration, plus $90 for the vaccine).
The statement shown above from Dr. Ellis’s office to Mrs. Jones dated Jan. 31 shows the same dates of service, a slightly different description of services, and corresponding charges of $185. It shows that Mrs. Jones paid the co-payment ($15) at the time of service. It shows that the account balance is $170, but the insurance company payment hasn’t been posted yet, so there is no amount due from Mrs. Jones at this time.
Second statement
Mrs. Jones will receive another statement from Dr. Ellis’s office after the insurance company makes a payment. This second statement will show the $55 payment received from Healthway on Feb. 25, and it will show the Negotiated Savings amount of $15 (from the EOB) in the Adjustment column. It also will show the balance of $100, which will then be due from Mrs. Jones.
Dr. Ellis sent Ann’s blood to a lab to be tested. The lab will send a claim for the test to Mrs. Jones’s insurance company. The lab will also send a bill to Mrs. Jones. After the insurance company pays the lab, Mrs. Jones may need to pay the lab any remaining balance.
Questions to ask your doctor
- What portion of this service will my insurance cover?
- When should I expect to see a bill from your office?
- Who should I talk to if I don’t understand the descriptions of the services provided?
Resources
American Association of Retired Persons: How to Read Your Medical Bill
