Which situation allows an insurance company to deny a consumer's application for Medicare Supplement coverage?

The situation where an insurance company can deny a consumer's application for Medicare Supplement coverage is when the consumer does not prove guaranteed issue eligibility. Guaranteed issue rights are specific situations that allow an individual to apply for a Medigap plan without undergoing medical underwriting. If a consumer fails to demonstrate that they meet these criteria, such as being eligible due to losing other health coverage or having a qualifying event, the insurance company may refuse to sell them a policy.

In contrast, while applying during open enrollment provides a better chance for guaranteed coverage, missing this period doesn't strictly result in denial; alternatives may still exist. Similarly, having a termination notice alone does not inherently bar someone from obtaining coverage, nor does being in good health affect eligibility negatively, as policies are generally designed to offer coverage regardless of health status during specific enrollment periods. Thus, demonstrating guaranteed issue eligibility is critical in securing a Medicare Supplement policy.