Rocky Mountain Health Maintenance Organization (RMHMO) Conversion Plan
On September 8, 2016, Rocky Mountain Health Maintenance Organization, Inc. and its subsidiaries (collectively “RMHMO”) submitted to the Attorney General its plan to convert from nonprofit to for-profit status (the “Conversion Plan”). RMHMO is a Colorado nonprofit corporation recognized by the Internal Revenue Service as a tax-exempt organization under Section 501(c)(4). Pursuant to her authority over charitable assets as set forth in Colo. Rev. Stat. § 24-31-101(5) (2016) and the common law, the Attorney General will review the Conversion Plan.
The Conversion Plan includes a 100% sale of RMHMO’s assets to United HealthCare Services, Inc. (“UHC”) post conversion. On July 22, 2016, RMHMO entered into a Stock Purchase Agreement with UHC (the “Agreement”), subject to regulatory approval. Under the Agreement, Rocky Mountain Health Plans Foundation (the “Foundation”) will become the sole shareholder of RMHMO and will receive the purchase proceeds resulting from the sale of RMHMO to UHC. The Foundation is a Colorado nonprofit corporation recognized by the Internal Revenue Service as a tax-exempt organization under Section 501(c)(3). The Foundation was formed in 1997 to provide greater access to health care services, to improve health outcomes for patients, to educate the public about community health care and wellness issues, and to more effectively utilize health care resources for people across Colorado.
The complete Conversion Plan submitted to the Attorney General, including all supporting documents, is posted here. Any supplemental material will be posted as soon as possible, generally within two (2) days of receipt by the Attorney General.
The Department of Law held a public hearing on October 26, 2016 in Grand Junction. A link to the audio recording of that hearing can be found here.
The Attorney General will accept public comment on the Conversion Plan and any supplemental documents here. The public comment period is now open, and will remain open through close of business on November 30, 2016.
The Conversion Plan, and any supplemental documents and public comments, will be reviewed by the Attorney General’s Office. Please check this website for updates on the status of this Conversion Plan.
The Conversion Plan contains the following documents
- Plan of Conversion for Review by the Attorney General, with attached Exhibits
- Exhibit 1 – Organizational Structure Chart of RMHMO
- Exhibit 2 – History of Rocky Mountain Health Plans Foundation
- Exhibit 3 – Stock Purchase Agreement, dated July 22, 2016
- Exhibit 4 – “Form A” Statement Regarding the Acquisition of Control of a Domestic Insurer, as submitted to the Colorado Division of Insurance
- Exhibit 5 – An Opinion of Fairness (Redacted)
- Exhibit 6 – Discussion Document Regarding the Fair Market Value of a 100% Interest in Rocky Mountain Health Plans as of June 30, 2016 (Redacted)
- Exhibit 7 – Plan of Conversion for RMHMO, dated August 26, 2016
- Exhibit 8 – Prospective Board Members for the Rocky Mountain Health Plans Conversion
- October 18, 2016 Supplemental Submission re RMHMO Community Benefit Contributions
- October 18, 2016 Supplemental Submission re RMHMO Long Term Debt Obligations
- October 18, 2016 Supplemental Submisstion re RMHMO Executive Agreements (Redacted)