What is an Explanation of Benefits (EOB)? – Understanding Health Insurance, Part 4

The last time you visited the doctor’s office or were treated for a medical issue, you may have received a document in the mail from your insurance company clearly marked, “NOT A BILL.” Although this paperwork can indeed appear as an invoice at first glance, it is actually what your insurance company refers to as an Explanation of Benefits, or EOB.


Insurance companies send out EOB’s to notify you of what services they’ve billed on your behalf – this effort helps to minimize fraud and inform patients of what their insurance covers. In this blog post, we’ll explore what an EOB describes, the components of this type of document, and how it factors into billing.


What does an EOB typically describe?


An EOB can be helpful to understand different aspects of your insurance, including:

  • The roles of the payee (the medical office billing for services), the payer (health insurance company) and the patient (you)
  • Elements of the service performed: the date of the service, the description and/or Current Procedure Terminology (CPT) code for the service, the name of the person or place that provided the service, and the name of the patient
  • The doctor’s fee, and what the insurer allows—the amount initially claimed by the doctor or hospital, minus any reductions applied by the insurer
  • The amount the patient is responsible for
  • Reasons for adjustment and adjustment codes (any amount of the bill taken off by the insurance company before payment)

Keeping informed of these elements can clear up questions about your payments and charges – and if you have questions to ask your insurance company, your EOB can equip you with information to expedite the process.


How does an EOB factor into the billing process?


Aside from your monthly insurance premium payments, you should never receive a bill directly from your insurance company. All the bills you receive for services and treatments come directly from the medical office.


That said, your EOB is helpful to understand your charges and how your insurance covers your expenses. When a claim gets submitted to your insurance company, your insurance will make adjustments and pay their applicable portion based on your policy. With these amounts, an EOB is sent to you (the patient), and an Explanation of Payment (EOP) is sent to the medical office. These items inform both the patient and medical office about the portion of the claim paid by insurance – any remaining amount becomes the member’s responsibility.


See an example of an EOB below:






You’ll note that at the top of the page it states what the document is (an EOB) and what it is not (a bill). Highlighted in yellow are the key elements:

  • Charges: The amount that was billed to the insurance company from the medical provider
  • Provider Responsible Amount: The amount your insurance company is obligated to pay for based on your policy
  • Member Responsibility Section: Expenses that may fall to the insured person, and what part of your plan these costs comes from
  • Amount You Owe: The total amount for this service you as the patient are responsible for. On this example EOB, the member is only responsible for $20. This quantity will get billed to you directly from the office you visited

When Will I Receive an Actual Bill?


The timeline for when exactly you get billed can depend on several factors. Claims need to be submitted by medical providers to insurance companies within a certain window of time – this window varies based on the insurance company. Typically, claims are submitted anywhere from 30 days to a full year after you receive service. However, our insurance and billing department at Reflex works hard to get claims submitted within a month of service.


Once the insurance company has received the claim, they have an average of 30-90 days to process this claim and send an EOP to the medical office. Once the medical provider receives the EOP, they will bill you directly for your portion during their next billing cycle. In the end, you likely won’t receive a bill for medical services until several months after you had the actual treatment or visit.


Should you ever have any questions about a bill you receive from Reflex, please give our office a call and someone from our Insurance and Billing Department will happily review it with you.


If you are struggling with chronic or intermittent knee pain that is affecting your daily life, call to schedule an appointment with one of our specially trained physicians today at (503) 719-6783.

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