[FoRK] Adverse selection in insurance

Benjamin Black b at b3k.us
Sun Oct 18 12:48:04 PDT 2009

Gordon Mohr wrote:
> 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
> objection?

Certainly!  Now you just have to prove that is what is going on.  That
they are not properly insured we know.  That they are _choosing_ that
state (by deciding health insurance is useless, by buying luxuries,
etc.) we do not know.


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