One of the biggest challenges when you “get sick” or have an unscheduled procedure is understanding your in-network or out-of-network insurance and how your healthcare provider can help you after you submit your bill. How do you read the description of benefits and EOBs? . Every insurance plan has its own policy to communicate the amount billed by the provider, the amount allowed, and the amount owed for the deductible or co-insurance if the deductible is met. There is a system of oh! This can be very difficult as you have to have a statement from your health care provider listing all the items billed and compare it to her EOB on your insurance plan. Unfortunately, each provider, each insurance plan has its own system, and patients struggle with how to categorize it. In this two-part series, we’ll show you how to read her EOB while comparing it to her health care provider’s statement.
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Let’s take a look at the perks/EOB descriptions of the two insurance plans to provide a key to understanding.
Insurance A: Example 1Column headings are specific to each insurance company.
Service Date, Service Code and Description (This includes the Revenue Code/Used by hospitals to identify department-specific charges. Example: 301 Lab – Hematology. Individual lab tests are listed No. Only categories.352 CT scans – body scans.) Fees charged, amounts allowed. The amount allowed is the amount that is the result of an in-network agreement. The difference between what is claimed and what is allowed is “absorbed” by the provider. The total amount paid by either the insurance plan or the patient is the amount permitted, not the fee charged. Plan paid, deductible, out-of-pocket. The deductible must first be met before the copay can be paid. The amount you pay for your plan is the net result of your allowable – deductible – out-of-pocket costs (where applicable). Non-Reimbursable Charges. If there are any services that are not covered by the insurance plan, please state so. To further clarify the EOB, you should always read the “comment code and explanation” in addition to a bit of math.
ex) 99214 office/outpatient visit, established. The EOB is preceded by the doctor’s name. Fee charged: $201. $145 available. The plan is that from the patient he paid $95 deductibles $0 copays $50. Add: $95 premium + $50 copay = total amount paid to health care providers = $145. The healthcare provider has to absorb her $56 difference. $145 + $56 = $201 billed fee.
Insurance B: Example 2Column headings are specific to each insurance company.
date of care. Description of Care (This is a more general description: medical, imaging, radiology, and office visits. No additional descriptions.) Amounts charged by providers, amounts not reimbursed , discounted rates. (The difference between the billed charge and the discounted charge/in-network charge is the amount not covered by the compensation.) Applies to amounts paid by us, deductibles, copayments, and amounts payable by you. Use “your discount rate – deductible – copay = amount paid”. The amount you owe is the deductible and/or copay. “Remarks” is at the end of each price item.
E.g.) Medical (patient may have service and not remember what was actually done. This is a pre-operative ECG interpretation done by the doctor and unknown to the patient Physician’s name is listed with each item.) Charged: $18 Excluded: $5 Discounted rate $13.
A deductible of $13 applies. The insurance plan paid $0 because the deductible of $3,500 was not met. The total amount payable to the provider is $13 per in-network discounted rate/subscription rate.
Part 2 shows how to adjust the EOB for provider itemized statements. Each provider can have its own statement/separate format. Practice tying them all together. Go ahead.
Dei Exschiza
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Day Egusquiza is President and Founder of Patient Financial Navigator Foundation Inc., an Idaho-based family foundation. For more information, call 208-423-9036 or visit pfnfinc.com. Have a Health Care Buzz topic? Share it with us at [email protected].
