This paper strives to do three things: (1) operationalize the concept of a Medical Care Risk Index, (2) recommend an approach for computing the index, and (3) identify how the value of benefits of health insurance plans held at a particular point in time can be calculated. This effort was undertaken because, in 1995, the National Academy of Sciences (NAS) Panel on Poverty and Family Assistance recommended that the Federal government develop a Medical Care Risk Index to be used as a companion to measures of the well-being of the population. They suggested that this be a prospective measure of the adequacy of health insurance in the U.S., focusing on future risk by identifying that proportion of the population which has inadequate coverage in the face of potentially high medical expenditures. While NAS expressed the opinion that the index could be computed independent of an economic poverty measure, they recommended it take into account each family's resources in determining its ability to pay for needed to receive medical care. This approach is in accord with recent literature in the area of a health services research. This recent research points to an approach for defining underinsurance that relies on individuals' potential out-of-pocket costs in the event of a catastrophic illness or injury. Being a prospective measure, and not dependent on explicit insurance provisions, this method of defining underinsurance proves to be an excellent model for the Medical Care Risk Index.