The committee by a 5-1 vote approved a substitute for Senate Bill 61 that instead of requiring the health care giant to pay 3 percent of its $2.9 billion in revenue in taxes for the benefit of Utah schools would force IHC to sell its insurance business within the next two years.

IHC president and chief executive Bill Nelson said he was "shocked and stunned" by the committee's action, which sends the substitute measure to the Senate floor for debate and an eventual vote.

"We spend two hearings talking about how Utah has the lowest per capita health care costs in the nation," Nelson said. "Now they [legislators] seem to want to perform a vivisection. They want to cut up a living, functioning company to see if it works."

Last week, senators approved Senate Bill 34, which would give patients - not their insurance plans - power to choose their doctors and hospitals.

Sen. Michael Waddoups, R-Taylorsville, unveiled the original version of SB61 to the public late last week. He argued the Utah-based health care company with its network of hospitals, physician panels and insurance plans, stifles competition in the state and acts like a for-profit company.

Waddoups, however, quickly threw his support behind the substitute bill offered by Sen. Darin Peterson, R-Nephi.

"I've gotten a lot of e-mails and heard a lot of horror stories from people about how IHC treats them," Waddoups said, noting that IHC also may be harming competition by limiting the number of physicians that can participate in treating patients under its health care plans.

IHC Health Plans generates about 25 percent of IHC's annual revenue.

And Nelson wasted no time after the hearing painting a picture of the devastation that could be wrought upon the company if SB61 becomes law.

He said if IHC were to sell its insurance company to a for-profit company, premiums would go up, raising the cost of health care for a large number of Utahns. He projected that the amount received by Utah doctors and hospitals would go down - the result of the new owner's drive for profits.

In addition, much of the claim-servicing work now performed by IHC would likely be moved outside of Utah, costing the local economy hundreds of jobs.

Nelson speculated that much of the opposition IHC faces may be spurred by disgruntled physicians who are not allowed to participate in providing services under the company's insurance plans.

"Clearly, we're going to have to work with the Legislature and continue a dialogue so they can understand what all of the numbers they are hearing mean," Nelson said.