Covered California Certified Enroller Practice Exam

What does EOB stand for in health insurance?

1. Evaluation of Benefits

2. Explanation of Benefits

3. Estimated Out-of-pocket Balance

4. Emergency of Benefits

The correct answer is: Explanation of Benefits

In health insurance, EOB stands for "Explanation of Benefits." This document is provided by an insurance company to its policyholders after a claim has been processed. It outlines what medical services were covered, how much the insurance paid, and what portion of the costs the insured person is responsible for. The EOB serves as a detailed statement that helps individuals understand their benefits and the claims made against their insurance policy. It includes crucial information such as the dates of service, the provider of the service, the total charges, any adjustments made by the insurance company, and any deductibles or co-pays that the insured must cover. By providing this information, the EOB aids in clarifying the relationship between the insured, the healthcare provider, and the insurance company. In contrast, the other terms provided do not accurately reflect what EOB means in the context of health insurance. "Evaluation of Benefits" might imply a review process that does not exist as a standard term, "Estimated Out-of-pocket Balance" inaccurately suggests a future prediction of costs that are not represented in an EOB, and "Emergency of Benefits" does not correlate with established terminology used in health insurance practices.