Medical Benefit (Loss) Ratio

Post date: May 6, 2017 5:35:33 AM

I updated the Medical Loss Ratio page of this website given the recent interest in #agetax. The debate seems to ignore the value-added of the premiums that go to the insurance company rather than for medical services rendered. If the MLR is 80%, then health insurers take 20% of a very large number. Some fraction of the $3.2 trillion in US health care spending (2015) paid by insurance companies. Even if only half of the $3.2 trillion was covered by insurance companies (i.e., $1.6 trillion), that means roughly $320 billion (depends on the actual MLR of an insurer) spent on administering claims, marketing, overhead, and profits. I'll work on a better number in the future. The number is in billions of dollars! Yet little research on how this chunk of healthcare premiums being spent.