On Dec 1, 2007 9:15 AM, Jim Devine <[EMAIL PROTECTED]> wrote: > The fact that the insurance companies use the adverse selection theory > tells us that they will restrict coverage (using non-price means) to > those who are guaranteed to be well (in the case of health insurance).
Maybe there is a basic problem about using insurance to provide health care. By definition insurance is about protecting people from unpredictable rare events. In health care, the service requirement is neither really rare nor unpredictable. It is not surprising that the economics of the insurance industry should fail under such conditions. -raghu.
