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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Jul 16, 2021

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What follows is a discussion of the Non-Waiver provision of the model individual health insurance policy we are using for review.

(Typical wording*):

Limitations, Exclusions and Non-Waiver (cont.)

C. Non-Waiver

a. Billed charges for medical care and treatment received by all Insureds during a Calendar Year that are considered and applied by Us under the section of the policy entitled Increase in Lifetime Policy Maximum, does not mean We have any liability for coverage or for the payment of any 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 Provider Benefits and Miscellaneous Benefits under the policy for the illness, injury or condition that resulted in such expenses. Any such mistake or error by Us shall not constitute a waiver of or modification to any of the conditions, terms, definitions, limitations or exclusions contained in either the Policy or any exclusionary rider attached to the Policy.

b. Expenses charged to an Insured for Prescription Drugs that are mistakenly applied by Us to the Calendar Year Deductible or Separate deductible for Non-Participating Providers or erroneously paid by Us under the Outpatient Prescription Drug Benefit shall not:

1. constitute a waiver of or modification to any conditions, terms, definitions, or limitations contained in the Policy, specifically including, but not by way of limitation, the definitions of Sickness and Injury, the limitation of coverage under the policy for Pre-existing Conditions, as well as any exclusion, limitation and/or exclusionary riders which may be attached to the policy, or otherwise operate to alter, amend, affect, abridge or modify the Policy;

2. create or establish coverage of any medical condition, illness, disease, or injury under the policy or under any exclusion, limitation and/or exclusionary riders which may be attached to the Policy; or

3. affect, alter; amend, abridge, constitute or act as a waiver for the Company’s ability to rely upon, assert, and apply such terms, definitions, limitations or exclusions of the Policy or nay amendments thereto.

In order for the Lifetime Policy Maximum per insured to increase beginning with the next calendar year, a formula must be applied that is based on the total amount of all billed charges incurred by all insureds under the policy during the current calendar year.

Subparagraph a. above simply makes it clear that using all billed charges for purposes of making this calculation under the lifetime policy maximum provision does not serve as an acceptance by your insurance company that it is liable for insurance benefits.. The billed charges are used solely for the purpose of the calculation. Determining insurance company liability for the charges is a totally separate and unrelated exercise. The company just wants to make sure you know that. It also wants you to know that if, by chance, it mistakenly assumes liability for some of those charges perhaps because it is considering all the charges for purposes of their calculation, this error by the company does not act as a waiver of its right to deny similar future charges.

Similarly, under subparagraph b. above, your insurance company wants you to know that any mistakes it makes in payment of the prescription drug benefit does not somehow act as a waiver of the company’s right in the future to apply all the provisions of the policy that exclude and limit coverage. Nor does the mistake somehow act to create coverage that otherwise would not exist under the policy’s terms or serve to limit the company’s ability to rely on all the provisions of the policy.

If this is confusing, rest assured, you’re not alone. These all kind of say the same thing. They just want to make sure you understand.

*Wording may vary from contract to contract and from state to state.

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