Excerpt: This issue brief examines three main questions: To what extent are health plan administrative costs and profits responsible for the fast rise in premiums? Are California health plans' administrative costs and profits 'reasonable'? What has been the effect of medical loss ratio regulations in other states? The findings suggest that medical spending was the primary driver of recent premium increases. The research does not provide a strong case for or against medical loss ratio regulation in California, but rather raises issues and offers implementation considerations.

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