Question

What is the liability of MCO when it makes decisions about insurance coverage for hospitals stays?

Answer 1

While efficiencie and cost savings has been achieved, Managed Care Organizations (MCOs) have certain legal aspects under which insurance is provided. Other than insurance MCO provide a number of services for clients. Specifically, they are involved in credentialing, network development, and the hiring and firing of surgeons and other allied medical care workers and detailed contractual arrangements. The insurance industry has responded to the increase in claim exposure associated with the aforementioned activities by providing any number of insurance products. The liability depends on the type of insurance and the qualifications to that criteria. The final decision as to which coverage to purchase will be governed by the risks associated with a particular MCO, contractual protections, available cash flow, protections under federal and state laws. Federal and state laws are the ones that determine it.