EOBs don't help consumers understand coverage

A majority of insurers' explanation of benefits statements don't help consumers understand what their plan covers for specific claims, says a new report from consulting firm Dalbar.

The report evaluated EOBs to see whether insurers helped consumers understand the significance of the information and used certain design elements that enhance overall effectiveness.

"An EOB designed to provide understanding at the deepest level to serve the most inquisitive members will be the EOB that serves all members," Dalbar Managing Director Kathleen Whalen said Wednesday in a statement. The problem, however, is when insurers just tell their members what they owe, it only answers basic questions and frequently causes more confusion.

Dalbar found three insurers stood out of the crowd when it came to EOBs. A Blues plan, Cigna and WellPoint all excelled at describing and explaining the members' costs based on their specific health plan.

BlueAdvantage Administrators of Arkansas provided the best benefits summary, which clearly explained terms like deductibles and out-of-pocket maximums as well as their implications. The insurer also included charts showing how much the member has already spent toward deductibles and out-of-pocket limits.

Cigna, meanwhile, used almost an entire EOB page to define each line item to offer clear explanations in addition to data points. And WellPoint included verbiage about how the member can actually use the EOB, saying they should compare the statement to any doctor bills.

Other insurers have taken steps to improve their EOB statements. Premera Blue Cross has simplified and reorganized its explanation of benefits, making it easier to read, understand and use. And UnitedHealth is using more plain language to help promote health literacy and equity, FierceHealthPayer previously reported.

To learn more:
- here's the Dalbar statement (.pdf)