Jeffrey Wade
Understanding a medical bill can be a challenging task, as the billing process involves negotiations between insurance companies and healthcare providers. Patients often receive an Explanation of Benefits (EOB) from their insurance company, which details the costs of care, services availed, and dates. This should be compared with the bill from the healthcare provider to ensure correct charges. The bill may include total charges, allowed amounts, adjustments, and the insurance payment. Patients should also be aware of good faith estimates, which are expected charges provided by the healthcare provider, and the possibility of disputing bills if they deviate significantly from these estimates.
| Characteristics | Values |
|---|---|
| Statement Date | The date your healthcare provider printed the bill |
| Account Number | Your unique account number |
| Service Date | The dates you received each medical service |
| Description | A short phrase explaining the service or supplies received |
| Charges | The full price of the services or supplies before insurance is factored in |
| Total Charges | The full price for the service(s) and/or item(s) |
| Allowed Amount | The maximum amount a plan will pay for covered healthcare services |
| Adjustments | The amount subtracted from the total charges due to discounts or lower rates |
| Insurance Payment | The amount your insurance company paid or is expected to pay |
| What You Owe/Patient Balance | The amount you owe after your insurer has paid |
| Explanation of Benefits (EoB) | A notice from your health plan showing the costs of your care, including services and dates |
| Claim | A bill submitted by your healthcare provider to your insurance company listing the services provided |
| Good Faith Estimate | An expected charge estimate that providers must give if requested or scheduled in advance |
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What You'll Learn
Understanding the billing process
The billing process starts when you schedule an appointment with a healthcare provider. At this stage, you should ask about the services and supplies you will receive and the upcoming charges. You can also ask for the procedure codes and contact your insurance company to find out if these services are covered by your plan.
After your appointment, your doctor's office submits a bill (also called a claim) to your insurance company. This bill lists the services provided to you. The insurance company then uses this information to pay your doctor for those services. When the insurance company pays your doctor, they might send you a report called an Explanation of Benefits (EOB) or a billing statement. This is not a bill. It shows you what services you received, the amount your health plan agrees to pay, and the amount you owe. You should receive this before you get a bill from your provider.
Once you receive a bill from your healthcare provider, you will notice that it consists of multiple components that might not be clear to you. The bill will include the statement date, your unique account number, the dates you received each medical service, a description of the service or supplies, and the full price of the services or supplies before insurance has been factored in.
If you have health insurance, you should compare the bill with the Explanation of Benefits to make sure you were billed for the correct services and supplies, and that the amount you owe is the same as that shown in the Explanation of Benefits. If you don't have health insurance, you will usually need to pay the full amount shown on the bill.
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Explanation of Benefits (EOB)
An Explanation of Benefits (EOB) is a notice you get from your health plan that details the costs of your care. It is not a bill. It is an important document that outlines what your insurance company is paying for, what it is not paying for, and why. It is worth noting that not all insurance companies send EOBs, and not all doctors' offices send statements. You may receive one or the other, or both.
The EOB will include the services you received and the dates you received them, the amount your health plan agrees to pay, and the amount you owe. It is important to compare the EOB with your medical bill to ensure you were billed for the correct services and supplies, and that the amount you owe is correct. You could receive separate EOBs for each type of service or supply you received, especially if you received treatment from multiple providers or on multiple days. It is important to keep these notices for your records.
EOBs can contain complex medical terms, billing codes, and abbreviations. If you don’t understand the listed service or supply, contact your provider or facility. The EOB will also include the total charges, which are the full price for the service(s) and/or item(s). It will also detail the allowed amount, which is the maximum amount a plan will pay for a covered health care service. If your provider is out of network and charges more than the plan’s allowed amount, you may have to pay the difference, which is called “balance billing”.
It is important to keep your EOBs and any statements organized, for example, by filing them by date. This will help you access them easily if any questions arise. If you have any queries about your bill or EOB, contact your provider or facility. You can also contact the No Surprises Help Desk for assistance in over 350 languages.
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What you owe
When it comes to understanding your medical bill, it's important to distinguish between the bill itself and the Explanation of Benefits (EOB). The EOB is a notice you receive from your health plan that details the costs of your care, including the services received and the dates, as well as the amount your health plan agrees to pay and the amount you owe. It's important to compare the EOB with your medical bill to ensure you were billed for the correct services and that the amounts match.
The "What You Owe" or Patient Balance section of your medical bill refers to the amount you are responsible for paying after your insurer has covered their portion. This amount may be less than the total charges listed on the bill, as it takes into account the allowed amount, adjustments, and insurance payment. The allowed amount, also referred to as the eligible expense, payment allowance, or negotiated rate, is the maximum amount that your insurance plan will pay for a covered health care service. If your provider charges more than this allowed amount, you may be subject to "balance billing," where you are responsible for paying the difference.
Adjustments are another factor that can affect what you owe. Adjustments occur when your provider agrees to discount or charge a lower amount for a service, resulting in a reduction from the total charges. Additionally, the insurance payment amount represents what your insurance company has paid or is expected to pay, further reducing your financial responsibility.
It's important to review your medical bill carefully and compare it with the EOB to ensure accuracy. If you have questions or concerns about the charges, don't hesitate to contact your provider or insurance company for clarification. Keep in mind that you have the right to request a "good faith estimate" of expected charges before receiving a service, which can help you anticipate and dispute any unexpected bills.
In summary, the "What You Owe" section of your medical bill represents the outstanding amount that you are responsible for paying after considering the allowed amount, adjustments, and insurance payment. By understanding the components of your medical bill and staying informed about your insurance coverage, as advised by sources such as MedicalBillingandCoding.org, you can effectively manage your healthcare expenses.
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Negotiating prices
Negotiating the price of your medical insurance bill is a great way to reduce your healthcare costs. It is important to start the process early, as it is much more challenging to negotiate payment terms when the due date is approaching. You should also check your bill for errors, as these are common and can significantly reduce your bill. If you notice any discrepancies, contact your insurer for clarification.
If you are uninsured, check with your providers to see if they offer a discount for uninsured patients. Nonprofit hospitals, for example, are required to provide financial assistance programs for low-income patients. If you are insured, you can research the insured rate for the services you received and ask your healthcare provider's billing agency to honour that price. You can use sites like FAIR Health Consumer and Healthcare Bluebook to estimate the cost of a procedure in your area and determine if you have been overcharged.
If you are unable to lower the price, you can set up a payment plan. Many providers are willing to work out a plan that fits your budget, and hospital and clinic bills are often interest-free. You can also ask for a settlement amount, which is what the billing office will accept if you pay the bill promptly. If you are facing financial stress, consider reaching out to a patient advocacy group, as they often have financial assistance resources and programs that can help.
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Good faith estimates
A "good faith estimate" (GFE) is a requirement for patients to receive accurate information about their expected healthcare spending. Healthcare providers are mandated to give a GFE to uninsured patients or those who choose to self-pay. Insured patients who opt to self-pay when their insurer does not provide coverage may also be entitled to a GFE.
The GFE is provided either in print or via email, and the provider can discuss the information included in the estimate over the phone or in person if the patient requests it. It covers items or services related to the patient's care that are scheduled separately, like pre-surgery appointments, or physical therapy after surgery. It also covers items or services that will be provided by another provider or facility, and any additional items or services that the doctor did not anticipate before providing care.
If you schedule an appointment at least three business days in advance, you are entitled to receive a GFE within one business day. If you do not receive a GFE, you can ask your provider for one. You will need a GFE if you need to dispute your bill—you cannot dispute a bill without one. If you find that the amount you are billed is $400 or more above the GFE, you may be able to dispute the bill. Once a dispute is initiated, the matter is paused pending resolution, and the provider cannot attempt to collect the disputed amount or charge additional fees.
It is important to compare your GFE with the Explanation of Benefits (EOB) to ensure you were billed for the correct services and supplies. The EOB is a notice you get from your health plan that shows the costs of your care, the services you received and when, the amount your health plan agrees to pay, and the amount you owe. You should receive the EOB before you get a medical bill, and you should only make payments after receiving the bill. If you do not receive an EOB, contact your health plan to ensure that your provider has sent them a claim for your service.
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Frequently asked questions
An EOB is a notice you get from your health plan that shows the costs of your care, the services you received and the date you got them, and the amount you owe. It is not a bill.
The total charge is the full price of the service(s) and/or item(s). The allowed amount is the maximum amount a plan will pay for a covered health care service. If your provider is out of network and charges more than the allowed amount, you may have to pay the difference.
Your provider must give you a good faith estimate of expected charges if you request one or schedule services at least 3 business days in advance. You can use this to compare with your bill later.
Contact your health plan to make sure your provider has sent them a claim for your service. Not all insurance companies send EOBs, so check with them first.
