Investopedia

Continue to Site »

Medical Cost Ratio

Filed Under » ,
Dictionary Says

Definition of 'Medical Cost Ratio'

A comparison of a health insurance company's healthcare costs to its premium revenues. The medical cost ratio is one indicator of the insurer's financial health. Health insurance companies, like other types of insurers, are for-profit companies and must remain profitable to stay in business.

Investopedia Says

Investopedia explains 'Medical Cost Ratio'

For most major health insurance companies, a medical cost ratio of 85% or less is desirable. An 85% medical cost ratio means that a health insurer spends 85% of the premium dollars it receives on healthcare, leaving 15% for profit and non-medical costs such as administrative expenses, payroll, overhead and advertising.

Articles Of Interest

  1.

    How To Avoid Medical Debt

    Find out what you can do to avoid a financial meltdown when there's a medical emergency.

  2. What Does Medicare Cover?

    Don't assume you're insured. Find out what you can expect from this healthcare program.

  3. Health Insurance Tips For College Students

    Why buy for health insurance when your parents' policy can cover you? Read on to avoid paying twice.

  4. Concierge Healthcare: The Pros and Cons Of Having A Doctor On Call

    Concierge healthcare can mean extra attention from your doctor when you need it, but it isn't the best substitute for health insurance.

  5. Retirement: The One Thing Couples Shouldn't Do Together

    Staggering retirement can have both financial and emotional benefits for married couples.

  6. Top 5 Budgeting Questions Answered

    You don't need a degree to understand your money, begin saving and pay down debt.

  7. Investing In Medical Equipment Companies

    Learn the basics about medical equipment companies and how investing in them can benefit growth and value investors alike.

  8. How Does The Affordable Care Act Affect Your Taxes In 2013?

    Here is a look at how the Affordable Care Act will affect your taxes in 2013 and beyond.

  9. In Retirement, Snowbirds Leave Cold Weather Behind

    Rather than shivering away their golden years, retirees can fly south to winter in sunny locales.

  10. The Benefits Of Retiring Later

    Not only does retiring later give you more time to build your retirement nest eggs, but it may also keep you healthy.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Disaster Loss

    A special type of tax-deductible loss, similar to a casualty loss, where a loss has been incurred by taxpayers who reside in an area that has been designated as a federal disaster area by the President.

  2. Fool In The Shower

    The notion that changes or policies designed to alter the course of the economy should be done slowly, rather than all at once.

  3. Pattern Day Trader

    An SEC designation for traders who trade the same security four or more times per day (buys and sells) over a five-day period, and for whom same-day trades make up at least 6% of their activity for that period.

  4. Cost-Push Inflation

    A phenomenon in which the general price levels rise (inflation) due to increases in the cost of wages and raw materials.

  5. Happiness Economics

    The formal academic study of the relationship between individual satisfaction and economic issues, such as employment and wealth.

  6. Affluenza

    A social condition arising from the desire to be more wealthy, successful or to "keep up with the Joneses." Affluenza is symptomatic of a culture that holds up financial success as one of the highest achievements.
Trading Center