Attorney General Coffman Issues Approval for the Conversion of Rocky Mountain HMO to a For-Profit Business
Today Colorado Attorney General Cynthia H. Coffman approved the conversion of Rocky Mountain Health Maintenance Organization, Inc. (“Rocky Mountain HMO”) to a for-profit entity in conjunction with its sale to United HealthCare Services, Inc. (“UHC”). On September 8, 2016, Rocky Mountain HMO submitted to the Attorney General its plan to convert from nonprofit status to a for-profit, and the subsequent sale to UHC. The Attorney General reviewed the transaction and has issued an opinion detailing her review and approval.
Upon closing of the transaction, Rocky Mountain HMO will convert from a nonprofit to a for-profit, leaving the Rocky Mountain Health Plans Foundation as the sole shareholder. The Foundation will then sell 100% of its ownership interest to UHC for $36.5 million. The Foundation’s post-conversion Board of Directors will be independent from Rocky Mountain HMO and UHC, and will use the proceeds from the sale to continue and expand its charitable mission on the Western Slope. Attorney General Coffman will appoint a member to the Foundation’s board and conditioned her approval on the Foundation adopting board diversity and conflict of interest policies.
Prior to issuing her opinion approving the Transaction, Attorney General Coffman accepted public comment via the Attorney General’s website and hosted a public hearing on October 26, 2016 in Grand Junction.