Understanding Your Explanation of Benefits (EOB)

What is an Explanation of Benefits?

An Explanation of Benefits (EOB) is a document your health insurance company sends after processing a medical claim. It is not a bill — it is a summary of how your insurer processed the claim and what portion, if any, you are responsible for paying. Understanding your EOB is the first step to verifying that you are being charged correctly.

Key fields on an EOB

Billed amount: The amount the provider submitted for the service before adjustments.

Allowed amount (contracted rate): The plan's payment allowance for a covered service, which can include both the plan's payment and your cost sharing. In-network providers generally cannot balance-bill for covered services, but different rules can apply to out-of-network or noncovered care. See HealthCare.gov.

Plan paid: The amount your insurer paid directly to the provider.

Your responsibility: The plan's calculation of your potential share of the claim, which may include deductible, coinsurance, or copay. An EOB is not a bill; check the actual provider bill and ask about any discrepancy.

Why is the billed amount so much higher than the allowed amount?

The billed charge and the allowed amount can differ because of plan and provider payment arrangements. The difference varies by service, provider, and plan. Ask your insurer to explain the adjustments shown on your EOB.

What to do if something looks wrong

If the "your responsibility" amount on the EOB does not match what the hospital is billing you, contact the hospital billing department first. If the discrepancy is not resolved, file a formal complaint with your insurer. If you believe a service was incorrectly denied, you have the right to appeal the denial — the EOB will include instructions for filing an appeal.