Allowed Amount

The allowed amount is the maximum dollar amount your insurance pays for services billed by your provider. If the allowed amount is less than the billed amount, the provider may bill you the difference (also known as “balance billing”). For example, your insurance may pay up to $25 for labs and x-ray. Your lab bill, however, was $90. The lab will send a claim for that $90 to your insurance, and your insurance will pay the lab $25. The lab will then send you a bill for the difference ($65).