We are probably about to have some federal legislation prohibiting insurers from discriminating based on pre-existing conditions. This means if someone with cancer wants to change insurers, the new one he chooses can’t say no. They have to take him even though they will lose buckets of money. This will obviously drive up overall costs–it will basically be a redistribution of wealth from healthy to sick, just as forcing young, healthy people to buy health insurance will be. The idea is probably that the sick “customers” will be spread out more or less randomly among insurers, so that none of them is hurt in particular, though overall costs are raised so that the healthy are soaked for the benefit of the sick. So although a given insurer won’t want to see someone with cancer (say) sign up, they can’t stop it–and they will assume their competitors have this problem too, so it all evens out.
But what if the cancer people act together on purpose–say we get 100 or 1000 libertarians with cancer to find the least-libertarian insurer (say), all sign up at one time, and put it out of business. And so on.
Another idea: if I have cancer, suppose I am insured by insurer A and I approach B, and say “give me $50k and I will stay with A”. I can imagine such extortion schemes.
Very interesting thoughts. However, couldn’t company B simply say, assuming the cancer patient will cost them $50K, “Come on board. Your premium is $50K”? In other words, it’s one thing to say that they will be forced to accept someone and another to charge them an amount they will be willing to pay, isn’t it? They could claim that they “accepted” them, thereby fulfilling their legal requirement, but charge an amount so high that they cause the customer to balk (or, if not, ensure a expected profit). That would create a de facto rejection without the de jure rejection. Of course, I’m not up to speed on all of the details so I may not be addressing the actual language of the legislation. It may be that charging a higher price based on condition may be sufficient to trigger a charge of “discrimination” (as if insurance isn’t supposed to work that way). Do you expect that that will be the case?