What is an Explanation of Benefits (EOB)?

The Explanation of Benefits (EOB) is a document that insurers provide to policyholders after a claim has been processed. It outlines the services that were covered by the insurance plan, detailing the costs associated with those services. This includes the amount charged by the healthcare provider, the amount covered by the insurance, any remaining balance due by the insured, and any adjustments made by the insurance company.

The EOB serves as a transparent breakdown of how the claim was handled, helping policyholders understand their financial responsibility and how the benefits were applied based on their specific policy. This is essential for individuals to effectively manage their healthcare expenses and know what to expect in terms of costs.

Other options do not accurately reflect the purpose of an EOB. For instance, a summary of premium payments focuses on the premiums paid for the policy rather than claim details. An official response to insurance claims might be more formal communication regarding claim acceptance or rejection, while a description of insurance policy options pertains to the features and benefits of the policy itself, rather than the financial breakdown of charges after a medical service.