A term applied to a variety of organizations which contract to provide management services for the reduction and control of health care costs to corporations, insurers, and third party administrators. MCOs employ such methods as making decisions as to what care is to be given individual patients and where it will be provided, negotiating contracts with providers as to quantities of and prices for services (often discounts), and auditing and approving the bills for the services the patients receive. Sometimes the MCO offers a stipulated care package for a prearranged capitation fee. Typically such organizations do not themselves provide care and do not operate hospitals or other health care facilities. They would, however, have legal obligations similar to those of managed care plans.