What is a Managed Care Organization (MCO)?

A Managed Care Organization (MCO) is defined as a system that integrates the financing and delivery of appropriate healthcare services. This means that the MCO not only pays for healthcare services but also manages how these services are provided to ensure quality and cost-effectiveness. MCOs aim to provide healthcare in a way that promotes efficient use of resources, often through preventive care and coordinated services, which can lead to better patient outcomes.

By combining both the financial and delivery aspects of healthcare, MCOs can streamline processes and reduce unnecessary expenditures, ultimately leading to a more sustainable healthcare system. This integrated approach is a fundamental characteristic of managed care, making it distinct from other organizational structures that may focus solely on one aspect, such as delivery or financing.