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That's how you'd expect it to work, right? Not to say healthcare is a functional market (it's not), but in general, if something is less risky, then it should b
by MichaelDickens 3y ago
That's how you'd expect it to work, right? Not to say healthcare is a functional market (it's not), but in general, if something is less risky, then it should be more expensive. Insurance companies are less exposed to risk, so they're willing to pay more for healthcare than individuals.
- jksflkjl3jk3 3y agoFirst, I think he meant that the out-of-pocket cost (not including the insurance premiums that are already being paid) were higher than the no-insurance cost. But even if he meant the total cost, the way insurance reduces risk through diversification is analogous to investment in a less risky index fund vs a more risky single company: beyond some minimal operational overhead, the risk reduction should be free.