"Not paid in 2019" is for instances where the education institution did not report the 1098-T correctly. The IRS changed reporting requirements in 2016, and there are still a few instances where the school might report what was billed rather than what was paid, or subtract a scholarship and also report the same in Box 5.
Additionally, a scholarship could cross a year. For example, a 3,000 scholarship might pay in 2020 for expenses you paid in 2019. In this example, you could subtract the scholarship received in 2020 from the 2019 tuition so that you don't have to claim the scholarship as income in 2020.
The IRS is only concerned with what was paid in the tax year for education expenses of that tax year and/or the first 3 months of the following year.
IRS Pub 970 goes into detail about the credits and potential income.
IRS Pub 970
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