How to Read Your Medical Bills – Is it Even a Bill?

Ok… so first things first.

What I mean by “medical bills” in the title is literally just that.  It is a “BILL” sent to you for a balance that the sender is claiming that you “OWE” them.

The reason I feel led to be so specific is that often times an insurance company will send correspondence to one of their members and it appears to be a bill when it isn’t a bill at all.  In fact, most of the time it will be what is called an EOB (Explanation of Benefits).

First, let’s talk a little about EOB’s.

An EOB is simply what it stands for – an explanation of the benefits the insurance company provided to the Patient and Guarantor.  Depending on the insurance company, EOB’s can contain various information. It can contain some or all of the following things:

  • Patient Information – This is the person that received the medical services.  It can include the patient’s name, address, date of birth and insurance ID/Group number.
  • Guarantor Information – This is the name of the person that is the owner of the insurance policy.  It can include the same type of information as the patient.
    Example #1: Jane Doe is seen at the doctor.  Her husband John Doe works for ABC company and has an insurance policy for himself and his wife Jane.  The EOB would list Jane as the Patient and John as the Guarantor because he owns the policy through his employer.
    Example #2: Jane Doe is seen at the doctor.  She works for XYZ company and has an insurance policy for herself and her husband John.  The EOB would list Jane as the Patient AND the Guarantor because she owns the policy through her employer.
  • Facility/Physician Information – This could include information such as the name of the doctor who treated the patient or the facility where the patient was seen, their address, phone number, NPI (National Provider Identifier) and Tax ID.
  • Service Information – This section will include the date the patient was seen, the procedures that were done, what was charged and then several other monetary values that can be very confusing.  (That is exactly what this publication is going to go over. ☺)
  • Remark Code Details – These are codes that explain WHY the charges were processed the way they were.

If you receive this from your insurance company – it is NOT A BILL!!  Even if it states that you are responsible for a part of the balance.  A bill will come directly from the physician or facility – because that is who you owe if indeed there is a patient responsibility balance.  I’ll go over that more toward the end of this article.

When you receive an EOB, you will want to inspect it.  Like I mentioned in my “I am Angry” article, doctors are amazing and dedicate themselves to years of education to learn how to keep us healthy and to save lives, but not necessarily how to bill for it.  Some of them do get certified and learn the specifics, but many do not.  They hire coders and billers to take care of medical claims and billing and often times, the staff is just not trained properly.  Not to mention – we are all humans and are certainly make mistakes.


So first, you’ll want to look over the document and make sure things like dates, names, procedures, etc. are all accurate.  Now let’s get down to the numbers…

The numbers can really be confusing.  What the heck does “allowed amount” even mean and what are these crazy “adjustments” for?!

There is a lot of information in the Services section, but I am basically just going to explain the monetary values.  I will write an article on each one of these topics that is more in-depth and will try to remember to come back here each time an add a link to each section, but here is the basic breakdown:

Billed amount –  This is the amount that the doctor/facility billed the insurance company.  Now I know that some of you may be thinking these prices are ridiculous, but trust me – there is a reasonable explanation.  You honestly have no control over the amount that is charged here.  I will say that most doctors and facilities offer a significant discount for patients that have no insurance – but to be clear – that isn’t always the case.

Allowed amount – This is the amount that the insurance company is willing to pay for the service provided to this doctor/facility.  Every insurance company has a different amount they are willing to pay for each service – it is not the same amount across the board.  You have no control over this amount either.  This is an agreed upon amount between the doctor or facility and the insurance company.  The list of pricing is called a Fee Schedule.

Deductible amount – This is the amount you are being charged for the agreed upon amount of deductible you chose when selecting your insurance plan.  If you feel like this amount is incorrect, you need to call your insurance company – not the doctor/facility.  If the insurance company determines that they processed the claim incorrectly, they will correct it and send the updated information to the doctor/facility.

Coinsurance amount – Just like your deductible, the coinsurance is an agreed upon amount between you and your insurance company.  The doctor/facility has no control over this.  So if you feel this amount is listed in error – again, call your insurance company, not the doctor/facility.

CoPay amount – This is also an agreed upon amount between you and your insurance company.  However, the doctor/facility should have verified your insurance and any copay amount that should be charged prior to your appointment.  This amount should have been collected at the time of service.  If the doctor’s office told you “not to worry about it”, this does not mean you don’t have to pay it.  It just means, for whatever reason, they decided to not make you pay it up front and they were going to bill you for it.

Note: To be clear, Deductible, Coinsurance and CoPay amounts are the responsibility of the Patient/Guarantor.  The doctor/facility does not have anything to do with deciding these amounts.  If you feel like the amounts on the EOB are incorrect you need to contact the insurance company.  If you were charged something OTHER than what is listed on the EOB, you should contact the doctor/facility at that point.  If they do correct the error and issue any necessary refunds, then you need to contact your insurance company and let them know.  They will contact the doctor/facility directly.  You can even ask them if they can do a three-way conference type call so that you can hear the response.  Not all insurance companies will do this, but some will.

Adjustment or Other Adjustments – This one can get confusing, but it is really very simple.  Ok, so here is an example:
– A patient goes to the see the doctor for a sore throat, fever, and cough.
– The doctor examines the patient and determines the patient has an upper respiratory infection.
– The doctor codes the office visit with CPT 99214 – Don’t concern yourself with the codes at this point.  This example is really just about the adjustment amount.
– The doctor has determined the billed amount in his/her office for this service is $200 (this may or may not be accurate to what your doctor charges for this service – I’m just using it as an example for easy math purposes.)
– The doctor’s billing department submits the claim to the patient’s insurance company.
– The contract between the insurance company and the doctor states that the insurance will allow $80 for CPT 99214.  This means every time this doctor submits a claim with CPT 99214 listed on it, to this specific insurance company, he/she will get paid $80.  (Not necessarily by the insurance company – keep reading!)
– If the doctor billed $200 and only got paid $80 – there is still $120 remaining.  This is the “adjustment”.  It is actually called a contractual adjustment.  This means that any difference in between what the doctor billed and what the insurance company allowed must be adjusted off.  The doctor cannot bill this amount to the patient.

Provider Paid – This is the amount the insurance company actually paid the doctor/facility.  The above seems pretty simple – right?  $200 (billed) – $80 (allowed) = $120 (adjusted off).  Here’s the thing: just because the insurance company “allowed” $80 for CPT 99214 – does NOT mean that is what they are going to pay the doctor!!

If your EOB says:
Billed $200
Allowed $80
Adjusted $120
Paid $80
Then that means the insurance company paid the doctor EVERYTHING that is owed to him/her for that visit.  To be clear – if the allowed amount and the paid amount match – you owe nothing.  Period.

However, if the allowed amount and paid amounts are different – that means that the patient is responsible for the difference – which will either be deductible, coinsurance or copay.

As an easy example, say you go to the doctor and the person at the check-out counter tells you that you owe $20 for a copay, then the EOB would read more like this:

Billed $200
Allowed $80
Adjusted $120
Paid $60
See the allowed is $80 and the paid is $60.  There is a $20 difference – that is the copay that you are responsible for.  If you paid it upfront on the day you were at the doctor, then you owe nothing.  If you didn’t then you will still be responsible for that difference.

In that case, the EOB would actually read like this:
Billed $200
Allowed $80
Deductible $0
Coinsurance $0
CoPay $20
Adjusted $120
Paid $60.

In addition, if you haven’t fulfilled your deductible yet and you are responsible for a copay, it could look like this:

Billed $200
Allowed $80
Deductible $60
Coinsurance $0
CoPay $20
Adjusted $120
Paid $0

Notice in that example, the insurance company allowed $80 – based on the contract with the doctor, but did not actually pay the doctor anything.

The allowed amount is what the insurance company and doctor agree the doctor will get paid for the procedure – but the payment could come from the insurance company, the patient, or a combination of the two.

This brings us all the way back around to the bill.  Remember an EOB is not a bill – it just explains how the insurance processed your claim so you will know if you need to expect a bill from the doctor/facility.  That is why it is SO important to review your EOB’s.  If your insurance company doesn’t mail them to you – they may only offer them online.  Make sure you look for an EOB for EVERY visit you make to a doctor/facility.

When you get an actual bill, it will be from the doctor or facility.  For every bill you get, you should have a matching EOB.  If you go see the doctor for a sore throat at his/her office, you should be able to obtain an EOB after the doctor files the claim and the insurance processes it.  If you receive a bill from a doctor and have not received your EOB, you need to contact your insurance company or log in to their member portal to view your EOB or request that one is sent to you.  Your doctor bill and EOB should match exactly in regards to amounts allowed, paid, due, etc.

The title of this post is:

How to Read Your Medical Bills – Is it Even a Bill?

You should be able to determine from an EOB what you should owe a doctor/facility and why.  If there is any difference – something is wrong – call your insurance company asap!

In the case of a self-pay patient – meaning you have no insurance and only pay cash – it is a little different.  You should ask every doctor/facility for all of the following things:

  • A list of each CPT or Procedure code and description that you are being billed for.  The specific CPT codes won’t matter to you, but the descriptions will.  This holds the doctor accountable for what they are charging and lets you know exactly what the doctor is stating he/she did for you.
  • What is the billed amount of EACH code?
  • What is their self-pay policy?  (Do they offer a self-pay discount and if so what are the terms.  This is very important because some offices only offer a self-pay discount if you pay in full at the time of service.  Some offices only offer a self-pay discount if it is asked for!  These are things you really should ask when making the appointment.)

This post may be a little lengthy, but hopefully it was helpful.  Please take a moment to scroll up top and add your email to the subscribe box so that you will be notified every time I post.

Full disclosure: Medical Billing is something that I am very passionate about.  I am a patient somewhere and so are all of my family members and it is very important to me that our claims are handled as thoroughly as I handle other people’s.  I am a work at home mom and not all of my posts are medical billing related.  Not only am I opening my own Coding & Billing Educational Consultant business in 2018, I have been an Independent Consultant for a children’s book company since 2011 and I own a photography company with my daughter.  Also – I am a wife-ish, mother, self-employed nerd and I post about all kinds of things.  I would love to share them with you.

Please take a moment to comment or ask questions below.  You can also find me all over social media:

Twitter: WAHMCat & Medical Billing
Instagram: WAHMCat
Youtube: WAHMCat (I don’t have a video to go with this post, but I’m working on one – Still go subscribe! ☺)
Usborne: Usborne website, Facebook Page
Photography: Shutterbug & Co., Facebook Page

Thanks for reading, commenting, sharing, following and subscribing.  You guys are the best.


Cat Clayton, CPC, CPB, CPMA
PO Box 121861
Fort Worth, TX 76121


No insurance. Ugh!! (Warning! Scary pics of my throat!)

**Before I get started I must warn you, there are pics of my throat in this post and they are nasty!

Being a work from home mama means I haven’t had the opportunity to get medical insurance on myself. I mean, I’m a mom! I don’t have time to be sick! I have insurance on my kiddos. You know…my little goblins that go to school every day, don’t wash their hands near enough and Lord, lets not discuss how bad their bathroom can get!! And you guessed it…yep, I’m the one who cleans all their messes, wipes their brow when their sick and tries to keep them healthy.

Now me? Yeah, I hardly ever get sick. (But boy when I do – its a doozy!) So insurance is just not something I’ve thought was necessary. (Although as I get older I know it will be mandatory.)

What does all of this mean? It means that when I do get sick (and it isn’t something I can just sleep away) I have to pay an arm and a leg to be seen at an urgent care clinic or sit in the ER. Today I chose the ER, because everyone knows it takes forever to get through that mess. This means I’ll get to take a nap! Without the oldest 2 arguing and the youngest one slapping me in the face saying, “Mama? Mama?” wanting me to play.

Here was my experience:

12:00 noon – Admitted. People watching can be fun. In the ER, not so much, it was just sad. There was an elderly woman that was in a wheelchair and she just kept repeating, “Help me, help me, help me” over and over in a tiny little frail voice. Her daughter was there holding her hand telling her it would all be ok. Then there was a couple. The girl was checking her boyfriend in for depression. She was pregnant and obviously on some type of drug. And then there was Mr. Tattoo. Covered from head to toe with tats (not tasteful ones) with crazy hair and a face mask on, popping wheelies in the wheel chair someone had put him in. Ugh.

12:10 – Triage done. Lets move to a room. (What already?! I didn’t even close my eyes yet!)

12:13 – Oh hell no! The room they put me in had some kind of crusty white stuff on the mattress…


And someone else’s hair on the pillow…


I will not be taking a nap on that! I thought they changed these or had some kind of paper sheet in between patients! Gross!

12:15 – Nurse Ellen is here. Nice enough I suppose. She gave me ice chips so I was pretty excited about that. 🙂

12:25 – admitting is here: how are you going to pay for this? Out of pocket…sigh.

12:30 – Doc is here. Super nice guy. Looked in my throat for all of 2 seconds and said, “Oh goodness”. Because that’s what you want to hear all the doctors say.

This is what the right side looked like:


This is what the left side looked like:


The weird part is…it’s the right side that really hurts! Not the side that looks like I have a tooth growing in my throat!

Then basically said he wanted to give me a shot of penicillin in the butt to clear it up. And I could have a shot of steroids to reduce swelling faster (I opted out of that. I hear steroid shots really burn.) then a script for some liquid pain meds? Yeah…I don’t know about that.

1:06 – Still waiting on that shot. And starving. And can’t lay down.

1:10 – Nurse Ellen comes in to release me with my prescriptions. Um, yeah…so I still haven’t had that shot that is supposed to make me all better. And can you please switch the pain meds to pill form. Liquids are not really for me unless its Alka Seltzer – which is my go to drug.

1:12 – Dr. is back. He says “This isn’t really a question of what you prefer (pills or liquid). It’s simply what is sensical. (Is that even a word? I’m sure he meant sensible.) If your throat is swollen you shouldn’t try to swallow pills because they could get stuck and try new problems.” Thanks so much for saying I’m dumb – but I’ll take my chances with the pills. I know I don’t like liquid meds.

1:27 – Nurse Ellen comes in sporting a ginormous needle and no joke says, “You’re gonna be sorry you asked for this. It really hurts.”!!!! Are you kidding me? Then she says I need to pull down my pants because this has to go in your butt. So I do and then she tells me to just hang out a minute while she gets the computer on. I’m not an FML kind of person…but right there…in that moment with Evil Nurse Ellen behind me I was repeating ‘FML’ like a mantra!!

1:30 – The shot was not fun, but it wasn’t that bad. Now I have to hang around for 20 minutes to make sure I don’t have a reaction to the shot. So what the heck am I supposed to do! I’m flippin tired as hell but am not getting on that mattress (ok so I did sit on the very edge – I couldn’t stand there for 20 minutes.) And I am starving.

1:41 – These rooms have no doors…just curtains so you overhear everything. Somebody has a ringtone that says, “Ding, ding, ding, hey you want a taco?” For their text tone. (I love tacos and today is Taco Tuesday, but there is no way I could swallow taco shells. DAMMIT!) The nurse just asked the guy across from me if he smokes. He’s like, “You mean cigarettes?”

1:51 – And outta here. Nurse Ellen says my tush will be really sore tomorrow. Awesome.

So no nap. I’m going to get something to eat and going home to research personal medical insurance.