The provision restricts HMOs and their representatives from using untrue, misleading, or deceptive advertising, solicitation, or coverage documents, and limits cancellation, renewal refusal, and certain naming uses.
No HMO or representative of the HMO may cause or knowingly permit the use of advertising that is untrue or misleading, solicitation that is untrue or misleading, or any form of evidence of coverage that is deceptive. For the purpose of this chapter: A statement or item of information shall be deemed to be untrue if it does not conform to fact in any respect that is or may be significant to an enrollee of, or person considering enrollment with, an HMO; A statement or item of information shall be deemed to be misleading, whether or not it may be literally untrue, if, in the total context in which the statement is made or the item of information is communicated, the statement or item of information may be reasonably understood by a reasonable person, not possessing special knowledge regarding health care coverage, as indicating any benefit or advantage or the absence of any exclusion, limitation or disadvantage or possible significance to an enrollee of, or person considering enrollment in, an HMO, if the benefit or advantage or absence or limitation, exclusion or disadvantage does not in fact exist; and An evidence of coverage shall be deemed to be deceptive if the evidence of coverage taken as a whole, and with consideration given to typography and format, as well as language, is such as to cause a reasonable person, not possessing special knowledge regarding HMOs and evidences of coverage for HMOs, to expect benefits, services, charges or other advantages that the evidence of coverage does not provide or that the HMO issuing the evidence of coverage does not regularly make available for enrollees covered under the evidence of coverage. Chapter 8, part 1 of this title shall be construed to apply to HMOs and evidences of coverage, except to the extent that the commissioner determines the nature of HMOs and evidences of coverage render chapter 8, part 1 of this title inappropriate. An HMO may not cancel or refuse to renew an enrollee, except for reasons stated in the organization's rules applicable to all enrollees, or for the failure to pay the charge for coverage, or for other reasons promulgated by the commissioner. No HMO, unless licensed as an insurer, may refer to itself as an insurer or use a name deceptively similar to the name or description of any insurance or surety corporation doing business in this state. Any person not in possession of a valid certificate of authority issued pursuant to this chapter may not use the phrase “health maintenance organization” or “HMO” in the course of operation.