Prepaid health plan undergoes IRS audit

Client(s) Prepaid health plan

Jones Day successfully defended a proposed revocation of the tax-exempt status of a managed care plan by the IRS. We continue to represent the client regarding potential challenges to the tax-exempt status of two other affiliates and potential multi-million dollar unrelated business income tax in a large case IRS audit potentially involving major managed care operations in eight states presenting novel issues of tax-exemption largely unaddressed by the IRS for decades. The IRS rarely challenges exemption for operating health care organizations.