An explanation of benefits (EOB) is a document that shows how much your health insurance will pay for medical care or prescription drugs that you receive.
Value of an EOB
An EOB is generally prepared by your plan’s insurance company or Third-Party Administrator after a claim has been submitted by a provider.
When you get an EOB, you will see the total amount charged by your provider, the amount that your insurance will pay and the balance that you are responsible for. Importantly, it will also show you how much your employer’s plan has saved you.
An EOB also allows you to keep track of your deductible and out-of-pocket costs.
How to read an EOB
EOBs can vary from insurance company to insurance company. However, they generally are very similar and consist of three main parts.
- Part 1: Summary of patient details, including medical services provided, by whom, when, the amount billed, the amount paid by your plan, the amount not covered by the plan, etc.
- Part 2: Glossary of terms and definitions included in the explanation of benefits
- Part 3: Detailed listing of the cost of the care that you received. This section may also show how much of your deductible and out-of-pocket expenses that you have paid.
Is an EOB a bill?
No. An EOB is not a bill. It is provided to you to help you understand the cost of the medical care provided and how much your health plan will pay. If there is a balance after payment by your health plan, you will receive a bill for the balance later.