Medicaid HMOs Soar on Obamacare Victory
"Stocks appear to be trading on some disappointment that the guaranteed issue aspect of the law wasn't struck down," said Windley. "The diversified managed-care companies are impacted by the fact that ... somebody who wants insurance, they have to offer it to them, and they have MML floors -- the margin limitations on their business."
Minimum medical loss ratio is like the inverse of gross margin, or your cost of goods divided by revenue.
In a previous interview, Chris Rigg, a senior health care analyst at Susquehanna Financial Group, said that small group and individual health insurance business companies must spend at least 80% of premium dollars on medical care, and 85% for large group market, or else the company has to rebate money to consumers.
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