Incurred Expenses Not Regarded As Covered Expenses and Medical Necessity Defined Under Health Insurance Policy
These are two specific exclusions from coverage found in a typical individual health insurance policy.
(Typical wording*):
Limitations, Exclusions and Non-Waiver (cont.)
B. Exclusions: Coverage under this Policy is limited as provided by the definitions, limitations, exclusions, and terms contained in each and every Section of this Policy. In addition, this Policy does not provide coverage for expenses charged to an Insured or any payment obligation for Us under this Policy for any of the following, all of which are excluded from coverage:
- the amount of any professional fees or other medical expenses or charges for treatments, care, procedures, services or supplies which do not constitute Covered Expenses;
- Covered Expenses which exceed the Lifetime Policy Maximum Per Insured;
- Covered Expenses which exceed the amount of the Lifetime Transplant Maximum for all solid Organ Transplants, Bone Marrow Transplants and Stem Cell Transplants received by each Insured, including any applicable Covered Expenses for professional fees and facility fees incurred in Connection with harvesting the applicable donor organ or donor bone marrow for the purposes of such transplantation;
- the amount of any professional fees or other medical expenses contained on a billing statement to an Insured which exceed the amount of the Maximum Allowable Charge;
- any professional fees or other medical expenses for treatments, care, procedures, services or supplies which are not specifically enumerated in the Participating Provider Services Subject to Co-Pay, Non-Participating Provider Services Subject to Co-Pay, Participating Provider Services Subject to Calendar Year Deductible, Non-Participating Provider Services Subject to Separate Deductible for Non-Participating Providers and Miscellaneous Benefits Sections of this Policy and any optional coverage rider attached hereto;
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"Covered Expenses" consist of the items and services listed in the policy in the sections entitled: "Participating Provider Services Subject to Co-Pay," "Non-Participating Provider Services Subject to Co-Pay," "Participating Provide Services Subject to Calendar Year Deductible", "Non-Participating Provider Services Subject to Separate Deductible for Non-Participating Providers and Miscellaneous Benefits". Expenses for these listed items must actually be incurred by the insured and medically necessary.
Medically necessary defined: The policy defines "medically necessary" as
…any applicable confinement of an insured, as well as other diagnostic test, laboratory test, examination, surgery, medical treatment, service or supply listed therein that is provided to an insured:
- by or at the appropriate order, or upon the approval of a provider;
- for the medically recognized diagnosis or care and treatment of an injury or sickness;
- in a manner appropriate and necessary for the symptoms, diagnosis or treatment of such injury or sickness;
- according to and within generally accepted standards for medical practice;
- in the setting and manner appropriate for the treatment of the injury or sickness;
- not primarily for the convenience of an insured, family or a provider; and
- not investigational or experimental in nature.
In other words, a treatment is medically necessary if it is ordered by your doctor for a medically recognized diagnosis, and the treatment and setting for the treatment is the general protocol for the symptoms or illness and not merely experimental. The treatment must be reasonable and appropriate for the sickness, which leaves it somewhat open to discussion and interpretation.
If you have been denied coverage because the company has deemed it not medically necessary, with your physician's help, you have a chance of persuading your insurer otherwise by appealing their denial.
*Wording may vary from contract to contract and from state to state.
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