[FoRK] Adverse selection in insurance
gojomo at boxbe.com
Sun Oct 18 12:42:02 PDT 2009
Benjamin Black wrote:
> "Moreover, a significant proportion of individuals may be uninsured
> because many of them are charged high rates as a result of medical
> underwriting and many of them choose not to pay those rates."
> This economist trickery of saying not that someone can't afford to pay a
> given rate, but that they choose not to pay those rates has worn quite
> thin. If I have no money, I am not starving because I choose not to pay
> the going rates for food. Market religion results in some very strange
> notions about how people behave and why.
Your objection may apply if someone is living hand-to-mouth.
But what if, instead of buying health insurance at going rates, some
individuals are spending several times the cost of insurance on
discretionary pleasures like first-run movies, cable television, video
games, leisure travel, live events, or designer clothes -- or even
gambling, tobacco, alcohol, or other drugs? What if others with the
exact same income allocate it to health insurance instead?
*Then* can we economic tricksters and market religion true-believers say
these individuals "choose not to pay those rates"? Or is there still an
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