How to Game Unwise Insurance Regulations: Lessons from Massachusetts
Harvard Pilgrim, a major insurer in Massachusetts, has discovered that about 40 percent of people who bought its non-subsidized individual plan in a 12-month period left after less than five months. While these individuals had coverage, they incurred an average $2,400 in monthly medical bills — six times the plan’s projections. This drives up insurance costs for the rest of the population.
What a scam! Wait until you are sick to sign up for coverage — knowing you cannot be turned away. Then bail once your health problem is taken care of.
An insurance agent once told me he frequently gets calls from young, college-age women who suddenly want individual coverage when they find out they’re pregnant.
Most people don’t realize the system currently in most states is designed to encourage continuous coverage. If you maintain coverage without gaps greater than 62 days, insurers are required to sell you a policy. That way, people cannot game the system. The new health reform proposal would thwart these safeguards in return for a system that encourages people to game the system.
This is what is going to happen big time under Obama Care.
This is exactly what I would have expected.