MLR Medical Loss Ratio (Collection: Managed Care)

The amount of revenues from health insurance premiums that is spent to pay for the medical services covered by the plan. Usually referred to by a ratio, such as 0.96--which means that 96% of premiums were spent on purchasing medical services. The goal is to keep this ratio below 1.00--preferably in the 0.80 range, since the MCO's or insurance company's profit comes from premiums. Currently, successful HMOs do have MLRs in the 0.70-0.80 range.

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