South Carolina Code 38-33-140. Advertisements; application of provisions relating to trade practices; use of term “insurer” or “health maintenance organization”
(1) A statement or item of information is considered to be untrue if it does not conform to fact in any respect which is significant to a reasonable person enrolled in, or considering enrollment with, a health maintenance organization.
Terms Used In South Carolina Code 38-33-140
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Department: means the Department of Insurance of South Carolina. See South Carolina Code 38-1-20
- Director: means the person who is appointed by the Governor upon the advice and consent of the Senate and who is responsible for the operation and management of the Department of Insurance, including all of its divisions. See South Carolina Code 38-33-20
- Enrollee: means an individual who is enrolled in a health maintenance organization. See South Carolina Code 38-33-20
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Evidence of coverage: means a certificate, an agreement, or a contract issued to an enrollee setting out the coverage to which he is entitled. See South Carolina Code 38-33-20
- Health maintenance organization: means a person who undertakes to provide or arrange for basic health care services to enrollees for a fixed prepaid premium. See South Carolina Code 38-33-20
- insurance: includes annuities. See South Carolina Code 38-1-20
- Insurer: includes a corporation, fraternal organization, burial association, other association, partnership, society, order, individual, or aggregation of individuals engaging or proposing or attempting to engage as principals in any kind of insurance or surety business, including the exchanging of reciprocal or interinsurance contracts between individuals, partnerships, and corporations. See South Carolina Code 38-1-20
- Person: means a natural or an artificial person including, but not limited to, individuals, partnerships, associations, trusts, or corporations. See South Carolina Code 38-33-20
- Surety: includes insurance or a bond that covers obligations to pay the debts, or answer for the default, of another, including faithlessness in a position of public or private trust. See South Carolina Code 38-1-20
(2) A statement or item of information is considered 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 of possible significance to an enrollee of, or person considering enrollment in a health maintenance organization if the benefit or advantage or absence of limitation, exclusion, or disadvantage does not in fact exist.
(3) An evidence of coverage is considered to be deceptive if the evidence of coverage taken as a whole, and with consideration given to typography and format, as well as language, causes a reasonable person, not possessing special knowledge regarding health maintenance organizations and evidences of coverage therefor, to expect benefits, services, charges, or other advantages which the evidence of coverage does not provide or which the health maintenance organization issuing the evidence of coverage does not regularly make available for enrollees covered under such evidence of coverage.
(B) Chapter 57 of Title 38 is construed to apply to health maintenance organizations and evidences of coverage except to the extent that the director or his designee determines that the nature of health maintenance organizations and evidences of coverage render such sections clearly inappropriate.
(C) A health maintenance organization may not cancel or refuse to renew an enrollee, except for reasons stated in the organization’s regulations applicable to all enrollees, or for the failure to pay the charge for such coverage, or for such other reasons as may be promulgated by the department.
(D) No health maintenance organization 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 the state.
(E) 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.