Medicare Answers: Exclusion and Extension of Benefits for Medicare Supplement

  • Originally published April 16, 2012 , last updated December 23, 2014
  • Medicare
Medicare Answers: Exclusion and Extension of Benefits for Medicare Supplement

If you have a Medicare question you’d like answered, email it to AskRoger@SeniorMarketSales.com.

This week’s question deals with Exclusion and Extension of Benefits for Medicare Supplement.

Kathy asks:

“If a client applies for a med supp and is accepted, then goes into the hospital prior to the coverage beginning, who will be responsible for the bill? For example: The client applies for May 1 issue and is accepted — on April 30 goes into hospital and then to skilled nursing for 40 days. Old coverage was cancelled by client for April 30 as the new carrier had accepted the risk. Who pays the claim?”

Kathy, that is an excellent question, especially when you can write coverage up to 90 days ahead with most carriers, increasing the likelihood of a person being in the hospital when coverage switches.

This is a situation where the policy rules. Unfortunately most have not read though the policy but it truly is the claims bible.

We are dealing with two different provisions here. For the carrier that takes effect during that period, we go to the Exclusions Section:

Mutual of Omaha’s policy UM23-21613 clearly defines who is on the risk. This Section says:

We will not pay benefits for:
(a) Expense incurred while this policy is not in force, except as provided in the Extension of Benefits Section;
(b) Hospital or skilled nursing facility confinement incurred during a Medicare Part A Benefit Period that begins while this policy is not in force;

For the company that was Inforce at the time the Benefit Period started, we go to the Extension of Benefits Section. Again Mutual of Omaha’s policy UM23-21613 clearly defines who is on the risk.

If you incur expense for a continuous loss which began while this policy was in force, coverage for such loss will continue beyond the date insurance ends. This extension of coverage is:
(a) subject to your continuous total disability; and
(b) limited to the duration of the Medicare Benefit Period or, if none is applicable, payment of the maximum benefits.

We will not pay benefits for:
(a) expense incurred while this policy is not in force, except as provided in the Extension of Benefits section;
(b) Hospital or skilled nursing facility confinement incurred during a Medicare Part A Benefit Period that begins while this policy is not in force;

UM23-21613