Understanding Your Average Medical Bill
After visiting your doctor, getting a test at a lab, or undergoing any other kind of visit at a medical facility, you will eventually receive a bill indicating the charges you owe the provider. However, you will notice that it consists of multiple components that might not be clear to you, such as CPT codes, service descriptions, and various prices.
To reduce your confusion and health care costs (30-40% of medical bills contain errors), we’ve compiled some explanations of the most standard items you will find on your medical bills.
Statement Date – The date your health care provider printed the bill.
Service Date – Indicates the date of your appointment or when services were provided. Obviously, it should be different from your statement date. If you had multiple services performed over multiple days, it may be listed as a range of dates instead (for example, 12/5/2019 – 12/6/2019). Additionally, if you had testing or lab work done, the date may be later than your appointment if someone processed or reviewed your results following your appointment.
Type/Description of Service – A short phrase that describes the service or procedure you or your family member received. For example, it could say “ER Visit” if you made a trip to the emergency room at a hospital.
CPT Codes – Along with the description of service will often be a Current Procedural Terminology, or CPT, code. CPT codes are standardized medical codes that are used to report medical, surgical, and diagnostic procedures and services. The CPT codes help your insurer determine how much they will pay the provider, and what you will be billed in return. Compare your CPT codes to your description of service to ensure the codes make sense. Also, you can compare the codes on your bill to the ones in your Explanation of Benefits (EOB) to ensure they match, and you weren’t billed with an incorrect code.
Charges – This is the full price of the services or supplies you received before insurance has been factored in. It is not the amount you owe the provider—we’ll cover that shortly.
Adjustment – This is the amount the health care provider has agreed not to charge. Think of it as the discounted rate your insurance company and the provider have agreed upon if they’re in-network.
Insurance Payments – The amount your health insurance provider has already paid.
Balance/Amount Due – This is the actual amount you owe to the health care provider. It may consider whether you have met your deductible or you’re responsible for coinsurance as part of your plan. The total balance of the bill may also include any previous charges you have not paid or late fees. Do a quick check to ensure that you’ve been billed correctly, and nothing seems “out of place.”
If anything on your bill looks incorrect, you should follow up with your provider’s billing department to correct any errors. It could save you a significant amount of money!