Merritt Personal Lines Manual: More Health Insurance Definitions
effective date: The date coverage begins for any insured person named in the application. This date is shown on the application. For a newborn child, the effective date will be the birth date of that child.
For a person or coverage added to the policy after the effective date, it is the date shown on an amendment which is to be attached to this policy.
The effective date of coverage for each person is shown in the application. Newborn children are frequently covered automatically from the moment of birth, but notification and an additional premium may be required. For additional family members (a new spouse or adopted child), coverage takes effect when the change is attached to the policy.
extended care facility: An institution which is recognized as a skilled nursing facility by the state in which such institution is located; is regularly engaged in providing continuous skilled nursing care under the supervision of a graduate registered nurse for 16 hours and a graduate registered nurse or licensed practical nurse for the remaining eight hours; maintains a daily medical record of each patient; and administers a planned program of observation and treatment by a physician (other than proprietor or an employee of such facility) which is in accordance with existing standards of medical practice for the injury or sickness causing confinement.
The definition of extended care facility, as herein defined, shall not include any home, facility, or part thereof used primarily for rest, for the care of the aged, drug addicts or alcoholics, or for the care and treatment of mental or nervous disorders, or educational care or any facility used exclusively for Custodial Care.
These paragraphs distinguish an extended care facility, which provides skilled nursing care, from a hospital, which provides a broader range of medical, diagnostic and surgical services. Coverage for extended care may be optional or excluded in basic medical policies (it's usually included in major medical policies).
The term "extended care facility" doesn't include rest homes, old age homes, substance abuse treatment centers, facilities that treat mental illness, or facilities that exclusively provide custodial care (assistance with the tasks of daily living such as dressing, eating, bathing, etc.).
hospital: An institution which is operated according to law, is primarily engaged in providing in-patient medical care and treatment to injured or sick persons for which a charge is made and provides or operated (either on its premises or in facilities available on a pre-arranged basis) medical, diagnostic and major surgical facilities under the supervision of a licensed physician; and provides 24 hour nursing service by or under the supervision of a graduate registered nurse.
For purposes of treatment of alcoholism, a hospital shall also include an institution which is accredited by the Joint Commission on Accreditation of Hospitals; and offers medical, therapeutic and psychiatric care for the treatment of alcoholism.
A special unit of a hospital or any institution which provides primarily convalescent, rehabilitative, nursing, ambulatory or extended care is not considered a hospital as defined.
This passage defines a qualified "hospital." Generally, it must be primarily engaged in providing inpatient care and treatment 24 hours a day and have medical, diagnostic and major surgical facilities under the supervision of a licensed doctor. The definition is necessary because policies often provide different benefits for hospital care and care received from other types of facilities.
injury: Accidental bodily injury sustained, directly and independently of all other causes, from an accident occurring while this policy is in force.
This pivotal definition has two important elements.
First, the phrase "accidental" will sometimes cause disputes between insurance companies and policyholders. On rare occasion, an insurance company will try to enforce an intentionality exclusion on medical coverage. This will usually involve issues of self-inflicted injuries or intentional physical abuse, which are separate exclusions. This definition of "accident" supports those exclusions.
Second, the phrase "in force" is more likely to cause disputes. Insurance companies will sometimes claim -- in situations involving major injuries--that some of the problems happened either before or after the policy's time limits.
insured person: Any person covered under this policy.
Any person covered by the policy is an "insured person." (Compare this passage with those in the standard homeowners or auto policies for more details.)
loss: An insured expense or event for which this policy provides payment.
"Loss" is a more general version of the term "accident" that appears in the definition of "injury." Simply said, this means anything that happens that triggers some form of coverage under the policy. This word has such general meaning that it's not often the center of disputes.
Medicare: The program of medical care coverage provided under the Title XVIII of the Social Security Act of 1965, as amended.
Medicare is an important element in health insurance. Under many policies, benefits provided will terminate or be reduced when a policyholder or insured person becomes eligible for Medicare.
mental or nervous disorder: A neurosis, psychoneurosis, psychopathy psychosis, or mental or emotional disease or disorder of any kind.
Mental or nervous disorders are defined specifically because many policies limit benefits for such treatment.
physician or surgeon: A person who is a practitioner of the healing arts who is licensed by the state to treat the injury or sickness causing the loss.
A physician or surgeon must be a licensed medical practitioner. This issue has caused disputes in a few, loudly trumpeted cases involving non-physician medical staff (and, in a few cases, sales representatives for medical device makers) performing surgery or other specialized procedures. These situations are very rare, though.
policy date: The date shown on [the declarations] page. It will be used to determine anniversary dates and premium due dates.
policy term: The period of time for which you selected coverage. Your policy term is shown on [the declarations] page.
The policy date is usually the original effective date. It is treated as an anniversary date and used to determine premium due dates. The insurance company may have a right to refuse renewal or to raise the premiums on an anniversary date.
The policy term is the period for which coverage is to be effective. Many policies are issued for an annual term and are renewable. Some policies may be issued for longer terms and may not be renewable.
These items are also important for the same reasons mentioned in the discussion of the phrase "policy... in force."
