The Real Cause of Market Failure in Health Insurance
By Arnold Kling
What we are left with, then, is that people do not want real health insurance. I would gladly take a health insurance policy with a $10,000 deductible per individual, and I suspect that many of my wise, risk-averse TCS readers would, too. But we are in a tiny minority! Most people do not want to be responsible for the first $10,000 in medical expenses, and most people believe that an insurance policy that is expected to pay no claims 95 percent of the time is a bad deal.
Could people be persuaded that what I think of as health insurance–a policy with a very high deductible and a relatively low premium–is decent health insurance?