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.

Frequently asked questions

• ‍How long should I keep medical billing paperwork
  Keep all claim related documents until the claim is fully resolved. If you plan to deduct medical expenses on your taxes, the IRS generally recommends keeping supporting records for at least three years.‍
• What if I never received an Explanation of Benefits
  You can request a copy from your health plan. If you have Medicare Advantage or a Part D plan, look for monthly statements. For Original Medicare services, review your Medicare Summary Notice which arrives about every four months.‍
• What if I believe a bill violates No Surprises Act protections
  ‍File a complaint through the federal help desk. You can also learn more about the protections and when they apply.‍
• What if I cannot afford the bill from a nonprofit hospital
  Ask for the hospital financial assistance application. Federal rules require written policies, limits on charges for eligible patients, and reasonable efforts before extraordinary collection actions.

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.