Breaking Down Medical Bills

Introduction

Medical bills can feel confusing. You might receive a bill from a hospital or clinic, a separate bill from a specialist, and an Explanation of Benefits from your health plan. Knowing what each document means and how to compare them can save you money and stress. This guide walks you through practical steps to review bills, correct mistakes, and get help paying when you qualify.

What your bill is and what it is not

An Explanation of Benefits is not a bill

If you have health insurance, your plan sends an Explanation of Benefits. It shows what was billed, what your plan allowed, what the plan paid, and what you may owe afterward. It helps you understand a later bill. It is not a request for payment.

The Medicare Summary Notice is also not a bill

If you have Original Medicare, you receive a Medicare Summary Notice about every four months listing services, what Medicare paid, and the maximum amount you may owe the provider. It is not a bill. Use it to check claims and costs before paying any provider invoice.

Keep your paperwork

Hold on to your Explanation of Benefits, Medicare Summary Notices, and bills until the claim is fully resolved. For tax purposes, the IRS generally advises keeping documents that support deductions for three years. If you plan to deduct medical expenses, keep related records for that period.

Quick checklist to review any medical bill

1. Ask for an itemized bill with each service and charge listed.
2. Compare your itemized bill to your Explanation of Benefits or your Medicare Summary Notice to see what insurance allowed and paid.
3. Check for common errors such as duplicate charges, services you did not receive, incorrect quantities, or the wrong date of service.
4. Confirm network status. If you used insurance, make sure your visit was in network and that out of network charges were not applied where protections apply.
5. If you are uninsured or not using insurance, confirm that you got a Good Faith Estimate in advance when you scheduled care and check whether your bill is at least four hundred dollars over the estimate. If it is, you may qualify to dispute it.
6. Ask about financial assistance if the bill is from a nonprofit hospital. Federal rules require written financial assistance policies and reasonable efforts before collections.
7. If the bill still looks wrong, contact your insurer or Medicare and the provider billing office to request a review or appeal using your documents as proof.

Understood Care can review your bill, spot errors, and handle the calls and appeals for you so everything is done right with less stress.‍

How to read your bill and your Explanation of Benefits

What to look for on a medical bill

Match your name, dates of service, provider names, and each service description. Validate the total charges, any adjustments or discounts, payments already received from insurance, and the remaining balance. Ask for codes or descriptions if anything is unclear.

What to look for on an Explanation of Benefits

Your Explanation of Benefits shows the amount billed, the allowed amount, what the plan paid, and your share. If the provider bill asks for more than your share, call the billing office with your Explanation of Benefits in hand.

If you have Medicare

Use the Medicare Summary Notice to verify each service, what Medicare approved, what Medicare paid, and what you may owe. Compare it to any bill you receive before paying.

Your rights that can lower or remove a bill

No Surprises Act protections

The No Surprises Act protects most people with private health coverage from out of network balance bills for emergency care, certain non emergency services at in network facilities, and air ambulance services. If you are billed more than allowed, you can submit a complaint.

Good Faith Estimates for people not using insurance

If you are uninsured or choose not to use insurance, you can request a Good Faith Estimate before scheduled services. If your bill is at least four hundred dollars higher than the estimate, you can use the patient provider dispute resolution process.

Hospital financial assistance and limits on charges

Nonprofit hospitals must have a written financial assistance policy. They must make reasonable efforts to determine if you qualify before using extraordinary collection actions. For care covered by the policy, amounts charged to eligible patients must be limited under federal rules. Ask the billing office for the application and deadlines.

Step by step: Dispute or correct a bill

Gather and organize

Collect your itemized bill, Explanation of Benefits or Medicare Summary Notice, any Good Faith Estimate, and notes from phone calls. Keep copies of letters and emails.

Call the provider billing office

Explain what seems incorrect and reference your Explanation of Benefits or Medicare Summary Notice line by line. Ask for a corrected bill or a written explanation. If a service was canceled or never received, request removal.

Ask about discounts and payment plans

Many providers offer prompt pay discounts or interest free payment plans. If you have limited income, ask for the financial assistance application and how eligibility is determined under the hospital policy.

If you used insurance and a claim was denied

Appeal with your health plan and include supporting documents. Use the Explanation of Benefits notes to understand the denial reason and the deadline for appeals.

If you are billed far above your Good Faith Estimate

Use the patient provider dispute resolution process to have an independent reviewer decide a fair amount.

If a collector contacts you

You have rights under federal law. Debt collectors may not misrepresent the amount or collect more than allowed under the No Surprises Act. Dispute the debt in writing if it includes charges above allowed amounts.

From our advocates: How Understood Care helps

Debbie from Understood Care explains a simple plan many families find helpful. Keep your Explanation of Benefits or Explanation of Payment for at least three months. Compare your insurance document to the bill from your medical provider. Then have an advocate call the doctor or hospital billing office with you to clarify whether you do or do not owe the amount. Your advocate can explain the insurance decision, ask for corrections when a bill should not be due, and help you set up a payment plan or apply for financial assistance when appropriate.

Get help from Understood Care

An advocate can review your bills and insurance documents, call providers with you, request itemized bills, appeal denials, and help you apply for financial assistance. If you prefer to speak with someone, you can schedule a time that works for you.

Cross references for support
Analyze Bills
Appointments
Care Coordination
Lower Costs of Medication

Conclusion

When you slow down and compare the bill to your Explanation of Benefits or Medicare Summary Notice, many confusing charges make sense and true errors stand out. Use your rights under the No Surprises Act, request financial assistance when you qualify, and keep organized records. If you want a partner in the process, an advocate can help you understand exactly what you owe, why, and what to do next.

Making Sense of Medical Bills and Insurance Notices: Frequently Asked Questions

• Is an Explanation of Benefits the same as a medical bill?
  No. An Explanation of Benefits, often called an EOB, is not a bill. It is a summary your health plan sends after a claim is processed. It shows what the provider charged, what the plan allowed, what the plan paid, and what the plan believes you may owe. You do not pay the EOB itself. Instead, you use it to check any bill you later receive from a doctor, hospital, or clinic.
• Is a Medicare Summary Notice a bill I have to pay?
  No. If you have Original Medicare, you receive a Medicare Summary Notice, or MSN, about every four months. It lists the services that were billed to Medicare, what Medicare approved, what Medicare paid, and the maximum amount you may owe a provider. It is not a request for payment. Use it to review claims and costs before paying any bill that arrives from a provider.
• How long should I keep my EOBs, MSNs, and medical bills?
  You should keep your EOBs, Medicare Summary Notices, and bills until all related claims are fully resolved and any disputes are settled. If you plan to deduct medical expenses on your taxes, the Internal Revenue Service generally recommends keeping records that support those deductions for about three years. Keeping everything in one folder or file makes it easier to handle questions later.
• What is the first thing I should do when a medical bill arrives?
  Pause before paying and give yourself time to review. Ask the provider for an itemized bill if you do not already have one. An itemized bill lists each service, the date, the charge, and sometimes the code used for billing. Then compare that itemized bill to your Explanation of Benefits or Medicare Summary Notice to see what your insurance allowed and paid. This step alone often reveals mistakes or explains charges that seemed confusing.
• What kinds of errors should I look for on a medical bill?
  Common issues include duplicate charges for the same test or visit, services or procedures you never received, incorrect dates of service, and wrong quantities, such as too many units of a medication or supply. You may also see charges that do not match what your insurance documents show as allowed. If something looks unfamiliar or does not line up with your records, call the billing office and your health plan to ask for clarification.
• Why does network status matter when I review a bill?
  If you used your insurance, knowing whether the provider and facility were in network helps explain how much you should owe. In network services usually have lower costs and are often protected by additional rules. For some services, especially emergency care and certain care at in network hospitals, federal protections limit out of network balance billing. If you see out of network charges where you expected in network treatment, it is worth double checking with your health plan.
• What if I am uninsured or I chose not to use insurance for my care?
  If you are uninsured or you decide not to use insurance, you can request a Good Faith Estimate from the provider before scheduled services. This estimate outlines expected charges. If your final bill is at least four hundred dollars more than that estimate, you may qualify to use the federal patient provider dispute process. Keeping a copy of your estimate and comparing it to the final bill is important if you need to challenge the amount.
• What is a Good Faith Estimate and how can it help me?
  A Good Faith Estimate is a written estimate of the cost of scheduled services for people who are uninsured or not using insurance. It is meant to reduce surprises. If the final bill is much higher than the estimate by four hundred dollars or more, you may be able to ask an independent reviewer to decide a fair amount through the patient provider dispute resolution process. This can sometimes lower what you owe.
• What financial help is available if I cannot afford a hospital bill?
  If the bill comes from a nonprofit hospital, federal rules require the hospital to have a written Financial Assistance Policy. The hospital must make reasonable efforts to see whether you qualify for help before using harsh collection actions such as lawsuits or reporting the debt in certain ways. Financial assistance can reduce or even erase the amount you owe depending on your income and family size. You can ask the billing office for a copy of the policy and an application, along with deadlines and documentation requirements.
• How can I dispute or correct a bill that looks wrong?
  Start by gathering your itemized bill, your Explanation of Benefits or Medicare Summary Notice, any Good Faith Estimate, and notes from any earlier calls. Then call the provider billing office and calmly explain what seems incorrect, referencing your insurance documents line by line. Ask them to investigate and send a corrected bill or a written explanation. At the same time, you can call your health plan or Medicare to request a review of how the claim was processed. If a claim was denied or processed in a way that seems wrong, you can file an appeal using the instructions on your plan materials or Medicare notice.
• What should I do if a bill is much higher than the Good Faith Estimate I received?
  If you are uninsured or you chose not to use insurance and your final bill is at least four hundred dollars more than the Good Faith Estimate, you may be able to use the federal patient provider dispute resolution process. This process lets an independent reviewer look at your estimate and final bill and decide how much you should pay. Federal medical bill rights resources explain how and when to use this option and what deadlines apply.
• Do I have rights if a medical debt is sent to collections?
  Yes. Debt collectors must follow federal consumer protection laws. They may not misrepresent the amount owed or try to collect more than is allowed under laws such as the No Surprises Act. If you receive a collection notice for a bill you believe is wrong or inflated, you can dispute the debt in writing and ask for verification. It can also help to show the collector your Explanation of Benefits, Medicare Summary Notice, or Good Faith Estimate if these support your position.
• How can an Understood Care advocate help with confusing bills and insurance notices?
  An Understood Care advocate can sit with you by phone or video and review your bills, EOBs, and Medicare Summary Notices step by step. Together, you can check for errors, compare documents, and decide whether the bill is correct, needs clarification, or should be challenged. Advocates can call provider billing offices and health plans with you or on your behalf, request itemized bills, ask for corrections, help start appeals, and support applications for financial assistance when appropriate. Their goal is to make sure you only pay what you truly owe and to reduce the stress of handling medical bills on your own.
• What practical steps can I take today to feel more in control of my medical costs?
  You can start by saving every medical bill, Explanation of Benefits, and Medicare Summary Notice in one place. Ask for itemized bills, compare them to your insurance documents, and call with questions before you pay. If a bill seems too high or confusing, ask about financial assistance, discounts, or payment plans. Remember that you have rights under federal law, and you are allowed to ask for explanations in plain language. If you want a partner in the process, you can contact Understood Care and work with an advocate who will help you understand exactly what you owe, why you owe it, and what you can do next.

References

• https://www.cms.gov/medical-bill-rights
• https://www.cms.gov/medical-bill-rights/help/guides/how-to-read-bill
• https://www.cms.gov/medical-bill-rights/help/guides/bill-errors
• https://www.cms.gov/medical-bill-rights/help/guides/explanation-of-benefits
• https://www.medicare.gov/basics/forms-publications-mailings/mailings/costs-and-coverage/medicare-summary-notice
• https://www.cms.gov/medical-bill-rights/help/guides/good-faith-estimate
• https://www.cms.gov/medical-bill-rights/help/dispute-a-bill
• https://www.cms.gov/nosurprises
• https://www.cms.gov/newsroom/fact-sheets/no-surprises-understand-your-rights-against-surprise-medical-bills
• https://www.irs.gov/businesses/small-businesses-self-employed/how-long-should-i-keep-records
• https://www.irs.gov/charities-non-profits/financial-assistance-policies-faps
• https://www.irs.gov/charities-non-profits/billing-and-collections-section-501r6
• https://www.irs.gov/charities-non-profits/limitation-on-charges-section-501r5
• https://www.consumerfinance.gov/ask-cfpb/what-should-i-know-about-debt-collection-and-credit-reporting-if-my-medical-bill-was-sent-to-collections-en-2122/
• https://understoodcare.com/care-types/analyze-bills
• https://understoodcare.com/care-types/appointments
• https://understoodcare.com/care-types/care-coordination
• https://understoodcare.com/care-types/lower-costs-of-medication‍

This content is for education only and does not replace professional medical advice. If you have trouble breathing, chest pain, sudden confusion, or another emergency, call emergency services.