An EOB is a document issued by an insurance provider to a client as an explanation of benefits as they relate to the terms of the insurance coverage. Most often, the insurance explanation of benefits has to do with recent treatments administered by a physician or healthcare facility. The EOB details the treatments that took place, the portion of the cost that is covered under the terms of the policy, and the amount remaining for the patient to pay directly to the healthcare provider.
The insurance EOB serves several useful functions. First, the document helps to create a documented trail of all actions taken in regard to a specific medical claim submitted by the attending physician. This helps the patient and the insurance provider to establish and maintain a history of all types of medical treatment the individual has received since the policy was initiated.
For the patient, an EOB makes it easier to keep up with the accounting process as it relates to medical expenses. The medical explanation of benefits clearly defines the total billed cost for various medical services, the amount covered by the insurance provider, and the amount remaining for the patient to pay. This leaves no question in the mind of the patient as to the amount that is still owed on the medical debt.
Most insurance providers also include information related to the reason for paying or denying a line item found on the EOB. When payment is not extended on a particular item, there is normally a field where an explanation for the action is detailed. For example, the explanation may be that the patient has not yet met the deductible associated with the coverage, so no payment was issued to the healthcare provider. If the patient has met the deductible and terms of the policy allow the provider to pay a fixed percentage of the outstanding balance, that is also included in the detail. Information of this type is very important, especially if the patient wishes to appeal the decision of the insurance provider.
Just about any medical EOB can be thought of as a comprehensive health benefits statement, effectively providing the patient with a simple document that can easily be cross-referenced with the terms and conditions found in the health insurance policy. Today, many providers offer customers the opportunity to receive electronic copies of the document via email, as well as the more traditional approach of receiving a hard copy through the local postal service.