COB vs EOB: What's The Difference?

According to Grand View Research, the medical coding market size reached a value of a little over 18 billion USD in 2022. Experts predict this value will grow at a compound annual growth rate of 9.85% between 2023 and 2030.
The efficiency of how your company’s medical coding and billing team functions determines your own values and profits. You can either face financial gains or financial losses. There are a few key factors to take into consideration while working in this field. One of them is understanding different healthcare insurance benefits and contracts. Afterall you work closely with these insurance companies, it only makes sense to familiarize yourself with their rules and regulations.
One common question in relation to this is, “What is the difference between the coordination of benefits and explanation of benefits?” So let’s go over what these processes even are as well as the stark differences between them.
Before we sink into the depths of COB and EOB, let's review what medical billing and coding is and how it plays an important role in the healthcare system.
This pillar of the healthcare system meticulously records and presents the services provided by physicians to their patients. In fact, this process is dated back to 17th century England, where the London Bills of Mortality started collecting data on diseases. This rudimentary process assigned numerical codes to quantify the most common causes of death. Fast forward to the 1930s, and we find ourselves with the International
Classification of Diseases (ICD) system, a framework we still use today.
And a major supporting process of the framework happens to be Coordination of Benefits (COB).
COB simply helps insurers determine payment responsibilities when individuals have multiple plans. This allows payers to decide how a person will handle their payment responsibilities. For example, payers can determine which plan has the primary payment responsibility and how the other plans can contribute.
The COB makes sure that the supplemental insurance payers receive eligibility data and claims with the remaining payments. For the Benefits Coordination and Recovery Center (BCRC) to automatically transfer claims to private insurance companies, there must be an agreement in place. This is helpful to ensure there are no duplicate payments.
Now, let's shift our focus to the other half of this healthcare puzzle-Explanation of Benefits (EOB). This document is your key to understanding how your insurance claim is processed.
EOBs provide a comprehensive breakdown, detailing services, charges, coverage, and patient responsibilities. Keep them in your healthcare arsenal for any billing inquiries!
A solid grasp of EOBs is essential for maximizing your insurance benefits. It's like having a roadmap to navigate the intricate details of your covered services.
So what sets COB and EOB apart?
While both processes are intertwined, COB focuses on determining which insurance carriers cover the fiscal responsibility, whereas EOB details how your insurance covers the service cost.
As healthcare spending continues its upward trajectory, streamlined medical billing and coding procedures are more crucial than ever. Ensuring your team is well-versed in COB and EOB is vital for maintaining a seamless billing cycle.
Consider integrating third-party revenue cycle management software into your processes. It's a game-changer, allowing you to collect outstanding revenue faster and trim down administration costs.
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