How to Read Your Medicare Explanation of Benefits (EOB)

You’ve seen it in your mailbox — a thick envelope from Medicare or your insurance company labeled “Explanation of Benefits.” Most people glance at it and toss it aside, assuming it’s not important. But your Explanation of Benefits, or EOB, is actually one of the most useful documents you receive as a Medicare beneficiary — and knowing how to read it can help you catch billing errors, understand your costs, and protect yourself from fraud.

What Is an Explanation of Benefits?

An EOB is not a bill. It’s a summary of medical claims that were submitted to Medicare on your behalf, along with information on what Medicare paid, what your plan may have covered, and what — if anything — you still owe your provider.

If you’re enrolled in Original Medicare (Parts A and B), you’ll receive a Medicare Summary Notice (MSN) every three months, summarizing all claims processed during that period. If you’re in a Medicare Advantage plan, your private insurer sends EOBs after claims are processed, often monthly.

Key Sections to Look At

EOBs can look intimidating, but they follow a consistent structure. Here are the sections that matter most:

• Claim summary: Lists each service, procedure, or prescription, along with the date of service and the provider’s name. Make sure these match your actual appointments and treatments.
• Amount billed: What your provider charged Medicare. This number is often higher than what Medicare actually pays due to negotiated rates.
• Medicare-approved amount: The amount Medicare agrees to pay for the service. Providers who accept Medicare assignment cannot charge more than this.
• Medicare paid: What Medicare actually sent to your provider — usually 80% of the approved amount after your deductible is met.
• You may be billed: Your share of the cost, typically 20% of the approved amount, plus any unmet deductible. This is what you should expect to pay your provider.

What to Do If Something Looks Wrong

Billing errors and fraud are more common than most people realize. Medicare estimates that billions of dollars are lost each year to improper payments. Reviewing your EOB carefully can help you catch problems early.

Watch out for:

• Services or procedures you don’t remember receiving
• Duplicate charges for the same visit
• Providers you’ve never seen listed on the form
• Charges for equipment you never received
• Dates of service that don’t match your records

If something doesn’t add up, start by calling your provider’s billing department. Many issues are simple coding errors that can be corrected quickly. Keep a personal log of your medical appointments and prescriptions so you have something to compare against.

If you suspect actual fraud, report it to the Senior Medicare Patrol (SMP) program or call 1-800-MEDICARE. You can also report fraud online at medicare.gov.

How to Appeal a Denied Claim

Sometimes Medicare denies a claim — meaning it won’t pay for a service your provider rendered. If you believe the denial was incorrect, you have the right to appeal.

The process has five levels, starting with a redetermination request. Here’s how to begin:

• Step 1 — Redetermination: Submit a written request to Medicare within 120 days of receiving your MSN. Explain why you believe the service should be covered and attach any supporting documentation from your doctor.
• Step 2 — Reconsideration: If the redetermination is denied, you can request a review by a Qualified Independent Contractor within 180 days.
• Step 3 and beyond: Further levels include an Administrative Law Judge hearing, a review by the Medicare Appeals Council, and ultimately federal court review.

Don’t let the process intimidate you. Many appeals are successful at the first or second level, especially when a doctor provides a letter supporting medical necessity. Your State Health Insurance Assistance Program (SHIP) can help you navigate appeals for free.

Key Takeaways

• An EOB is not a bill — it’s a record of what was submitted and paid on your behalf.
• Review each EOB for services you didn’t receive, duplicate charges, or unfamiliar providers.
• Your “you may be billed” amount is typically 20% of Medicare’s approved amount.
• Report suspected billing errors to your provider first; report suspected fraud to Medicare or your state’s SMP program.
• You have the right to appeal any denied claim — and free help is available through your state’s SHIP program.

Recommended Reading: 10 Costly Medicare Mistakes You Can’t Afford to Make — a highly rated guide to help you make the most of your retirement.