How to read an EOB for behavioral health claims: the fields, the codes and what the client owes

1. EOB, EOP, ERA: which one you're holding

Name	Who gets it	What it is
EOB (explanation of benefits)	The member (your client), by mail or in the plan's app	How the plan processed a claim: charge, allowed, what the plan paid and what the member may owe. Usually says "This is not a bill."
EOP (explanation of payment), provider remittance, remittance advice	You, on paper, as a PDF or in the payer's portal	The provider's version, often covering many clients and claims on one payment. Same numbers, plus check or EFT details.
ERA (X12 835)	Your billing system, through your clearinghouse	The electronic remittance, the HIPAA standard for health care payment and remittance advice (45 CFR 162.1602). Every paper EOP is a printout of these fields. Our sister site explains ERA and EFT enrollment.

Payers lay out paper EOBs differently, and a behavioral health carve-out sends its own, not the medical plan's. The fields are the same because the data underneath is the same.

2. Every field, and the 835 behind it

On the EOB	In the 835	How to read it
Claim number (payer's)	CLP07	The payer's ID for this claim. Quote it on every call, corrected claim and appeal.
Your account or patient control number	CLP01	The number you sent on the claim. How you match the EOB to your own record.
Claim status (processed as primary, secondary, denied)	CLP02	"Processed as secondary" means another plan was primary; "denied" means nothing was paid on the claim.
Member, ID, group	Patient and subscriber names (NM1)	Check it's the person and plan you verified. A different group number can mean a plan change.
Date of service	DTM*472	One line per date for therapy; for program days, one line per day or a span, depending on how you billed.
Service code	SVC01	The CPT, HCPCS or revenue code the payer processed. If it differs from what you sent, the payer changed it; look for a remark code explaining why.
Billed (charges)	SVC02, CLP03	Your charge, line and claim total.
Allowed (eligible, approved)	AMT*B6	What the plan says the service is worth: your contracted rate in network, the plan's out-of-network allowance otherwise (the uniform glossary definition). Everything the client owes is figured from this number.
Not covered, discount, provider responsibility	CAS with group CO (often reason 45)	The difference between billed and allowed, written off. Not the client's.
Deductible, copay, coinsurance	CAS with group PR, reasons 1, 3, 2	The client's share, by type. Add them for the patient responsibility.
Other insurance paid	CAS with reason 23	On a secondary claim: what the primary paid or adjusted.
Plan paid	SVC03, CLP04	The payment, line and claim total.
Patient responsibility ("you may owe")	CLP05	The total of the PR adjustments for the claim.
Remark or message codes	LQ*HE (RARCs)	The detail behind an adjustment: what was missing, which rule applied. Read every one.
Check or EFT number, date	TRN, BPR	Ties the payment to the deposit in your bank.

The arithmetic always balances: billed − all adjustments = paid, and allowed − PR adjustments = paid for a covered in-network line. If a line doesn't balance, you're missing an adjustment, usually one printed in a footnote.

3. Group codes: who carries each dollar

Every adjustment is a group code, a reason code and an amount, printed together like CO-45 $80.00. The group code is the part that decides who pays.

Group	Name	Who carries it	What to do
CO	Contractual obligation	The provider. You can't bill the client for it.	CO-45 is the normal write-off down to the allowed amount. Any other CO reason (CO-197 no authorization, CO-50 medical necessity) is a denial or reduction to work.
PR	Patient responsibility	The client, subject to your contract and what you told them in advance	Move it to the client's balance. Check that PR-1, PR-2 and PR-3 match the plan's benefit and your VOB.
OA	Other adjustment	Depends on the reason code	Often coordination of benefits (OA-23, the primary's payment) or a balancing entry. Read the reason before writing anything off.
PI	Payer-initiated reduction	The provider, in the payer's view	A reduction the payer believes the provider is responsible for when there's no contract term behind it. Question it if it isn't in your agreement.

4. Reason and remark codes behavioral health claims see most

Claim adjustment reason codes (CARCs) say why; remittance advice remark codes (RARCs, N- and M- codes) add detail. X12 maintains both lists: CARCs and RARCs. The ones that show up on therapy, IOP, PHP and SUD claims:

Code	Plain meaning	What it usually means for a VOB
PR-1	Deductible	The client hadn't met the deductible. Compare with the "remaining" amount you verified.
PR-2	Coinsurance	The client's percent of the allowed amount. Compare with the percent you verified for this level of care.
PR-3	Copay	A flat amount per visit or day. Some plans charge a copay per program day; check it was quoted that way.
CO-45	Charge exceeds the fee schedule or contracted amount	The normal contractual write-off. Check the allowed amount against your contract.
CO-197 / CO-198	Authorization absent / exceeded	The VOB said an authorization was needed (or should have) and none matched, or the days ran out.
22 / 23	Another payer may be primary / the prior payer's payment	A second plan. Get both cards and bill the primary first.
109	Not covered by this payer; send to the correct payer	The behavioral health benefit is carved out to another company (see carve-outs).
27	Expenses incurred after coverage ended	Coverage ended mid-treatment. Re-verify at each new month or plan year.
242	Not provided by a network provider	An HMO or EPO with no out-of-network benefit (see out-of-network benefits).
96 / 204	Non-covered charge / not covered under the client's plan	An exclusion the VOB missed, or a code the plan wants billed another way.
50	Not medically necessary, in the payer's judgment	Not a VOB problem: a clinical documentation and review question.

The full list, with fixes for each denial, is in our sister site's guide to behavioral health claim denials.

5. Example 1: a therapy session, paid

Made-up numbers. An in-network 53-minute psychotherapy session (90837). The VOB at intake said: outpatient mental health covered, $500 deductible with $60 remaining, then 20% coinsurance.

Line	Amount	Read
Billed	$200.00	Your charge
Allowed	$120.00	Your contracted rate
CO-45	$80.00	Billed minus allowed: written off
PR-1	$60.00	The rest of the deductible: matches the VOB
PR-2	$12.00	20% of the remaining $60 of allowed: matches
Paid	$48.00	$120 − $60 − $12
Client owes	$72.00	PR-1 + PR-2. The next session's EOB should show no deductible.

6. Example 2: an IOP week, partly denied

Made-up numbers. Four commercial IOP days billed at $600 each. The VOB said IOP covered after the deductible (met), 20% coinsurance, prior authorization required. The authorization approved three days that week.

Day	Adjustments	Paid	Read
Mon–Wed (3 days)	CO-45 $420 and PR-2 $36 each	$144 each	Allowed $180 a day; 20% coinsurance as verified.
Thursday	CO-198 $600, RARC naming the authorization	$0	More days than authorized. CO: you can't bill the client. Ask for an authorization update and appeal with it.
Week	—	$432	Client owes $108 (3 × $36); Thursday is yours to fix, not theirs.

The cause is upstream of billing: the authorization covered fewer days than the schedule. The prior authorization guide covers tracking units against the schedule so the fourth day is requested before it happens.

7. What the client actually owes

• In network: the PR total on the EOB, for covered services. Billing more than that for a covered service is balance billing, which an in-network provider can't do (HealthCare.gov).
• CO amounts: never the client's, whatever the reason.
• PR for a non-covered service (PR-96, PR-204): the client may owe it, but in-network contracts often limit billing members for non-covered services unless they agreed in writing in advance. Check your contract before you send the bill.
• Out of network: the PR total, plus the difference between your charge and the allowed amount if you balance bill and no law or agreement stops you; see out-of-network benefits.
• Medicaid: a provider who takes Medicaid accepts its payment, plus any cost sharing the state allows, as payment in full (42 CFR 447.15). Don't bill a Medicaid client the difference.
• After the out-of-pocket maximum: once the client's in-network deductible, coinsurance and copays reach the plan's out-of-pocket maximum for the year, covered in-network services should show no PR (HealthCare.gov). An EOB that still shows PR after the client hit it is worth a call. See deductible vs out-of-pocket maximum.

8. Checking the EOB against your VOB

The first EOB for every new admission is the test of your verification. Compare these five things, and log the result on the client's VOB:

Check	VOB said	EOB shows	If they differ
Covered at all	Covered for this level of care	Paid, or a denial code	Call with the VOB's reference number; ask the payer to review the call record.
Network	In network	In-network allowed amount, no CARC 242	Check the plan or product; being in network with one of an insurer's products doesn't cover the others.
Deductible	$X remaining	PR-1 amount	Other claims may have been processed in between. Ask for the current accumulator.
Coinsurance or copay	Y% or $Z per visit or day	PR-2 or PR-3	The claim may have processed under a different benefit (medical instead of behavioral health, outpatient instead of facility).
Authorization	Required, number and dates	No 197 or 198	Match the auth's dates, units, NPI and level of care to the claim.

Write down what you learn. If a payer always applies a per-day copay to IOP that the rep didn't mention, that's the next question on your VOB call script for that payer.

9. When the EOB says denied

1. Read the group code first. CO: the money is yours to recover from the payer, not the client. PR: confirm before billing the client.
2. Read the CARC and every RARC together. CARC 16 ("missing information") means nothing without its remark code.
3. Decide: corrected claim, reconsideration or appeal. A claim with your error gets a corrected claim; a payer error or a disagreement gets a reconsideration or appeal, within the payer's deadline.
4. Use the notice's own appeal rights. For employer plans under ERISA, a denial notice must give the specific reason, the plan provision it relied on, what information would fix it, and how to appeal (29 CFR 2560.503-1). For most individual and employer plans, the client can also ask for the diagnosis and treatment codes and their meanings (45 CFR 147.136). HealthCare.gov explains internal and external appeals for members.
5. Keep the trail: the VOB with the rep's name and reference number, the authorization, the claim, the EOB and every call. Our sister site's guide to appealing an insurance denial has letter templates.

10. What to tell the client

Clients get their own EOB, often before your statement. Most calls start with "the insurance says I owe something different." Have the EOB in front of you and walk them through the same lines:

"The paper your plan mailed you isn't a bill; it shows how they processed our claim. On the line for your October 6 session, they allowed $120. Because you had $60 left on your deductible, that $60 is yours, plus 20% of the other $60, which is $12. So your share is $72, and the plan paid us the rest. The $80 'discount' is ours to write off; you never owe that. Your next sessions should only show the 20%."

How Quick VOB helps

Quick VOB doesn't read EOBs. It makes them predictable: each check shows the deductible and out-of-pocket with what's left, in and out of network, and "Log the call" keeps what the rep said for each level of care with their name and reference number, so when an EOB disagrees with the verification you have the record in one place. Authorizations get an email 5 days before they end, which prevents the CO-198 in example 2.

Questions

How do providers read an EOB?

Line by line: billed, allowed, each adjustment with its group code and reason code, and paid. CO adjustments are written off, PR adjustments are the client's share, and OA or PI adjustments need their reason code read before anything is written off. Then check the allowed amount against your contract and the client's share against your VOB.

What is the difference between an EOB and an EOP?

An EOB (explanation of benefits) goes to the member; an EOP (explanation of payment), or remittance advice, goes to the provider and often covers many claims in one payment. Both show the same claim processing. The electronic version for providers is the X12 835, the ERA.

What do CO, PR and OA mean on an EOB?

They're group codes. CO is contractual obligation (the provider's write-off, not billable to the client), PR is patient responsibility (deductible, coinsurance, copay or another amount the client owes), and OA is other adjustment, often coordination of benefits. PI, payer-initiated reduction, also appears.

What does CO-45 mean?

The charge was more than the fee schedule or contracted amount, so the difference between your charge and the allowed amount is written off. It's the normal adjustment on a paid in-network claim, not a denial.

What are PR-1, PR-2 and PR-3?

The client's deductible (1), coinsurance (2) and copay (3). Their total is the patient responsibility for the claim.

Is the EOB a bill?

No. It explains how the plan processed the claim. The client's bill comes from the provider, and in network it shouldn't be more than the patient responsibility on the EOB.

What's the difference between a CARC and a RARC?

The claim adjustment reason code says why an amount was adjusted; the remittance advice remark code, an N- or M- code, adds detail such as which information was missing. X12 maintains both lists and updates them during the year.

Sources

1. 45 CFR §162.1602, Standards for health care payment and remittance advice (X12 835). ecfr.gov
2. X12, Claim Adjustment Reason Codes and Remittance Advice Remark Codes. x12.org · x12.org
3. CMS, Uniform Glossary of Coverage and Medical Terms (allowed amount). cms.gov
4. HealthCare.gov, "Balance billing," "Out-of-pocket maximum/limit" and "Internal appeals." healthcare.gov · healthcare.gov · healthcare.gov
5. 29 CFR §2560.503-1, ERISA claims procedure (content of a benefit denial notice). ecfr.gov
6. 45 CFR §147.136, Internal claims and appeals and external review processes. ecfr.gov
7. 42 CFR §447.15, Acceptance of state payment as payment in full (Medicaid). ecfr.gov

The examples are made up. This guide is general information, not legal or billing advice. Cima isn't a law firm or an accounting firm. Payer contracts and plan terms differ; check each one.