Congress would make insurers spend more money on consumers' care

Slate: "One of the biggest lingering criticisms of the Democrats' health care reform plan is that it doesn't control costs. This line persists in part because it's hard to refute in simple terms. ... But for those who want a single, clear example of how reform will attempt to keep the cost of health care -- or, at least, the cost of insurance -- down, there's no easier-to-grasp concept than the medical loss ratio."

This term refers to "the amount of each dollar an insurance company spends that goes toward paying for medical procedures, doctor's consultations, chiropractor visits -- in other words, actual health care." Under proposals in Congress, 80 to 85 percent of premiums collected would have to be spent on care, a figure major insurance companies already reach. It would be a big change for the individual insurance market where medical-loss ratio averages 74 percent. But, Slate reports, the classification of some services such as "disease management" could be considered both an administrative cost and a clinical service. However, when combined with such reform provisions as guaranteed issue and an individual mandate, the medical-loss ratio becomes more useful, Slate reports (Beam, 1/4).