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Respondent recognized Health Services as an organization
described in section 501(c)(3) that is exempt from taxation
pursuant to section 501(a), and as a public charity described in
sections 509(a)(1) and 170(b)(1)(A)(iii).
C. IHC Health Plans, Inc.
As a further step in its reorganization plan, IHC initially
intended to organize an affiliate to provide professional,
general liability, and worker's compensation insurance. However,
upon further reflection, IHC decided to create an affiliate to
operate as a State-licensed health maintenance organization
(HMO)2.
IHC’s decision was based on its consideration of an HMO’s
potential for generating medical care cost savings and
2 Utah Code Ann. sec. 31A-8-101(5) (1999 Repl.) defines the
term “Health maintenance organization” as follows:
(5) “Health maintenance organization” means any
person, other than an insurer licensed under Chapter 7
or an individual who contracts to render professional
or personal services that he performs himself, which:
(a) furnishes at a minimum, either directly
or through arrangement with others, basic health
care services to an enrollee in return for prepaid
periodic payments agreed to in amount prior to the
time during which the health care may be
furnished; and
(b) is obligated to the enrollee to arrange
for or to directly provide available and
accessible health care.
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Last modified: May 25, 2011