Cases & Developments

Opinion affirming-in-part, reversing-in-part, and remanding. In 1995, Iowa’s Individual Health Insurance Market Reform Act established the Iowa Individual Health Benefit Reinsurance Association (IIHBRA). The Act required that “all persons that provide health benefit plans in the state” be members of IIHBRA and authorized IIHBRA to assess its members, based on information they provided about premiums and losses, in order to equalize its members’ gains and losses. The University of Iowa, Iowa State University, and the University of Northern Iowa, which provided self-funded health benefit plans for their employees, contended they were not members and declined to pay IIHBRA’s assessments. Following a protracted procedural history, a bench trial awarded damages for unpaid assessments to IIHBRA, and the Universities appealed. In affirming the trial court, the Supreme Court of Iowa held that the Universities’ statutory interpretation that limited IIHBRA membership to entities enumerated as examples in the text is unduly restrictive. It further held that because the assessments were primary obligations of the Universities and did not impose suretyship for other entities, the Act did not violate the Iowa Constitution as applied to the Universities. The court affirmed the denial of attorney fees and costs but reversed and remanded with instructions to award 5% late payment fees to IIHBRA.