I want to continue to talk about health insurance this week. It is something we all enjoy having (wonderful benefit of working at TTUHSC) and it is something we work with every day to get paid for a major portion of the work our wonderful doctors (and other providers) do.

Last week, we discussed the concept of a co-insurance, and this week we will discuss what is commonly called an Explanation of Benefits (EOB). An EOB has some other names, like Summary of Benefits, Remittance Advisory, Coverage Determination or Beneficiary Notice. To some of you this is “old hat” but, we have new people join us all the time, and it doesn’t hurt to refresh our memory and clarify.

Every now and then my office receives a phone call from someone saying he or she is upset because Blue Cross/Blue Shield (just as an example; could be any carrier) sent them a bill for medical services. At that point, we patiently explain, “You would not have received a bill from Blue Cross/Blue Shield for medical services — but we can still help answer your questions.” We say this because patients do not receive bills for medical services from their insurers — they would only receive one from a health care provider. (Note: I am not talking about premiums, insurance companies do, of course, bill for those.)

What does an EOB do? It tells the date of service, the code used to bill a particular service, the fee charged by the health care provider, the allowed amount under the third-party payers’ contractual fee schedule, the patient’s responsibility under the terms of their coverage, the payment made by the payer, and the contractual write-off. It will also indicate if all or a portion of the claim is being denied and a denial code. The final entry of each line item is usually titled something along the lines of, “what you owe,” or, “your responsibility.”

It is easy to see why patients are confused when the EOB says “what you owe” despite the fact that the top of the paper says, “THIS IS NOT A BILL.” TTUHSC has to have an EOB (and the money from the payer in the bank) before we can post a payment to the patient’s account. An EOB for each patient encounter is essential to our operation.

So, that’s my best attempt to explain an EOB. If I left something out or anything needs correcting, feel free to post a comment. It will not hurt my feelings. Have a great week!