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


How Important is it… Really?

Soooo…. here it is.  4:17 am on a Monday morning.  What am I doing?  Trolling the internet looking for networking and business building ideas in and around town this week.  I always start with my notifications and then the things going on in the Events section of Facebook.  It never fails that I always find myself lost in some article that I found from clicking on a link somewhere on Facebook.  I have learned some pretty amazing things and added a billion things to my useless knowledge bank from these clickable links.  However, I have also wasted several…. hours (ahem) minutes, reading through these articles.  Today I was lucky enough to stumble upon a gem… I think.

The link that I saw said, “7 Surprising Signs You’re Not Getting Enough…”  So, I clicked on it to find out what I may or may not be getting enough of.  This took me to an article at healthissues.pw about not getting enough… WATER!  At this point, I figured I had taken the time to click the link so I might as well see if I had any of the signs.

One of the first things it states is that your body is mostly water and even goes so far as to give percentages of water that different body parts are.  Percentages like, Your brain and heart are 73% water and even, bones are 31% water.  I’m not sure where they got that information or if it is even true.  However, I did find several websites that stated the same facts like water.usgs.gov, factslides.com and reference.com.  I generally hate to read things on the internet that force me to click 72.3 billion pages to get all of the information, but this one only had a few pages and also had already grabbed my attention with the opening, so I was willing to click each page to read the full article.

Here are the 7 signs they list as common symptoms you may be suffering from but not associating them with dehydration:

  1. Sleepiness. – WHAT?!  That’s like my middle name!  I have lengths of time where I only sleep 3 hours a night for weeks and then there are sometimes that I sleep an entire day away (and then hate myself for wasting such valuable time.)   It said that water allows your brain to focus and when it can’t it shuts down by inducing sleep.  That explains a lot!  Ok, now they really have my attention.  I definitely suffer from this symptom.
  2. Hunger. – WHAT?!  Do you even know me?  Food is like my favorite thing ever!!  Especially if it rhymes with paco, saco, maco… you get the idea.  But seriously – I am ALWAYS hungry!  So things like hunger and cravings for sweets can mean your body is actually craving water.  Hmmm, interesting.
  3. Blood Pressure Spikes. – Okay, so I don’t really struggle with this ailment, that I know of.  There have been times where I showed signs of high blood pressure and have checked it only to find I was normal.  Well… as normal as the kiosk in Walmart said I was.  Just incase though, I think I’ll try drinking a glass or two of water next time I have those symptoms.
  4. Headaches. – Everyday since I was 18.  Seriously.  Except for that one year when I went to the chiropractor 3 times a week.  Which seriously helped the headaches go away.  However, I quit going because it was quite pricey and also I was honestly terrified he was going to snap my neck.  Seriously, it terrified me.  Maybe I’ve watched a little too many crime dramas with people getting their necks snapped, but still.  The “crack-a-lack-a-lack” in the neck region really scares the poo out of me!  So as soon as I stopped my appointments the headaches came back and I get at least 3-5 every week.
  5. Constipation. – Maybe a little TMI, but my guess is everyone suffers from some type of bathroom issue from time to time.  So I can’t discount this as a possible symptom of not getting enough water.
  6. Bad Breath. – According to this article, saliva has antibacterial properties and dehydration prevents your body from making enough for it.  This leads to a virtual playground in your mouth and according to my 5 year old, who doesn’t mean to be rude and just speaks the truth – I may have a little issue with bacteria causing bad breath.
  7. Dry Skin. – Ok… well it is winter so I do suffer from dry skin a bit here and there, but I wouldn’t say it’s a chronic issue.  But, maybe it isn’t a winter ailment after all.  Maybe it’s because I’m not drinking enough water!

So after reading the entire article, identifying with most of the symptoms listed, and looking to see if the “facts” were listed on other websites – I’m self diagnosing myself with persistent dehydration.  As for the cure… water, of course.  So for the next 30 days I am going to drink nothing but water.  No sodas, no tea, and no…. sigh… Monster’s.  Starting today, Monday February 20th, 2017 and going through Wednesday March 22, 2017 – I will drink nothing but water.

On an average day I drink 1 glass or bottle (probably about 10-12 ounces) of water, one or two sodas or glasses of tea (usually Starbucks – because it is sooooooo yummy), 1-2 cans of Monster if I need the pick me up and every now and then a cup of hot tea from my trusty Kuerig.  But, for the next 30 days it will be only water.  The only exception I will make is to flavor the water from time to time with Kool-Aid Liquid Drink Mix, like these:


They offer a flavored water with zero calories, carbs or caffeine!  So I feel justified in adding this to my water while completing this challenge.

I would like to challenge YOU to play along!  Start today, start tomorrow – just give it a try.  Follow my journey on the Facebook page I created: 30 Day Water Challenge – Is H2O the Answer? or type in http://fb.me/H2Ofor30days in your browser page.  I’ll be posting anything I notice – or don’t notice – changing over the next 30 days.  I’ll also include a few healthy recipe’s and exercises throughout the journey – please feel free to do the same.

Look forward to seeing you out there and seeing if I notice a difference in things when only drinking water.  Now I’m off to finish my Yeti full of ice water, go potty for the 3rd time since I began writing this post, finish this episode of Smallville and maybe getting a few hours of sleep.  I’m starting our kitchen makeover this week and need the rest!

BIG Texas hugs,