Explanation of Benefits (EOB) | Practical Law

Explanation of Benefits (EOB) | Practical Law

Explanation of Benefits (EOB)

Explanation of Benefits (EOB)

Practical Law Glossary Item w-010-4691 (Approx. 3 pages)

Glossary

Explanation of Benefits (EOB)

A statement from a health insurer addressing the extent to which a health plan participant's or beneficiary's claim for payment for plan services will be reimbursed. An explanation of benefits (EOB) may include, among other things, information about:
  • The type of service provided and the date of service.
  • The amount a plan provider billed for the service.
  • Any discount the participant or beneficiary received for using an in-network provider.
  • The amount the plan paid.
  • The amount the participant or beneficiary owes.
  • The amount applied toward the plan's deductible.
  • Available review or appeals procedures.
An EOB involving a coverage denial is likely an "adverse benefit determination" under the Department of Labor's (DOL's) claims regulations. As a result, an EOB must satisfy specified content standards for denial notices, among other requirements (see Claims Procedure Requirements for Group Health Plans Checklist). Changes to the DOL claims regulations under the Affordable Care Act (ACA) also apply to EOBs. Under the ACA, for example, plans and insurers must provide more detailed information in their claims notices, including the availability, on request, of diagnosis and treatment codes and their corresponding meanings (see Practice Note, Internal Claims and Appeals Under the ACA).
Enacted in December 2021, the Consolidated Appropriations Act, 2021 (CAA-21) requires group health plans and health insurers (effective for plan years beginning on and after January 1, 2022) to furnish participants and beneficiaries advanced EOBs prior to receiving health care services (Pub. L. No. 116-260, Div. BB, Title I, § 111 (2020)). The advanced EOBs must contain specified information, including a good faith estimate of the services' cost based on billing and diagnostic codes.