IHC Health Plans, Inc. - Page 14

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               Petitioner operated an office known as Network Services that           
          negotiated and managed contracts between Health Services and                
          insurance carriers, third-party administrators, and independent             
               Petitioner employed between 600 and 700 employees during the           
          3-year period 1997 to 1999.                                                 
          D.  IHC Foundation, Inc.                                                    
               IHC organized IHC Foundation, Inc. (Foundation) to support             
          IHC’s and its tax-exempt affiliates’ charitable, educational, and           
          scientific activities.  Foundation received funds from grants,              
          donations, and other sources.  Respondent recognized Foundation             
          as an organization described in section 501(c)(3) that is exempt            
          from taxation pursuant to section 501(a), and as a public charity           
          pursuant to sections 509(a)(1) and 170(b)(1)(A)(vi).                        
          E.  IHC Insurance Company, Inc.                                             
               IHC organized IHC Insurance Company, Inc., (Insurance) as a            
          for-profit insurance company.  Insurance, which operated on Grand           
          Cayman Island, provided IHC, Health Services, and petitioner with           
          access to reinsurance coverage.                                             
          F.  Control                                                                 
               IHC had effective control of its affiliates, including                 
          Health Services, petitioner, Care, and Group, all of which were             
          subject to the ultimate governance and control of IHC’s board of            
          trustees and corporate managers.  Health Services, petitioner,              

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Last modified: May 25, 2011