Contractual adjustment

What does Contractual adjustment mean on a medical bill?

A contractual adjustment is the part of the charge the provider agreed to drop because of their contract with your plan. It is the difference between the list price and the allowed amount, and it should appear on your bill as a credit line, not as something you owe. It is not a favor and not a discount someone chose to give you. If a bill shows the full charge with no adjustment after insurance processed the claim, something in the posting is off.

What does Contractual adjustment usually cost?

The adjustment is money nobody collects: not from you, not from the plan. It exists only because of the contract, which is why out-of-network bills usually have none, and why the line disappears when a claim gets denied instead of priced.

What should I watch out for with Contractual adjustment?

• An itemized bill showing the full charge with no adjustment line after the plan paid
• An adjustment reversed and the balance rebilled to you — ask why the claim was reprocessed
• Compare the adjustment on the bill against the write-off on the EOB, since the two should match