IHC Health Plans, Inc. - Page 42




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          During 1999, petitioner’s enrollees represented                             
          approximately one-fifth of Utah’s total population and                      
          petitioner’s IHC Access plan enrollees constituted nearly 50                
          percent of Utah residents that were eligible for managed Medicaid           
          benefits.                                                                   
               Despite petitioner’s open enrollment policy and the wide               
          acceptance of its plans by individuals and groups alike,                    
          petitioner’s operations differed materially from the operations             
          of Sound Health Association HMO and Geisinger HMO.                          
          Significantly, petitioner did not own or operate its own medical            
          facilities, did not employ (to any significant extent) its own              
          physicians, and did not offer free medical care to the needy.               
          Additionally, petitioner did not institute any program whereby              
          individuals were permitted to become members while paying reduced           
          premiums, and, aside from the few free health screenings that               
          petitioner conducted in 1999, petitioner did not provide or                 
          arrange to provide any free or low cost health care services.               
          The record does not reflect whether petitioner applied surplus              
          funds to improve facilities, equipment, patient care, or to                 
          enhance medical training, education, and research.  See Rev. Rul.           
          83-157, 1983-2 C.B. 94.                                                     
               Importantly, the record does not reveal why petitioner                 
          applied an adjusted community rating methodology to determine               
          premiums for individual and small employer group enrollees while            






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