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Antidiscrimination in Health Care: Community Ratings and Pre-Existing Conditions
by Richard A. Epstein
Medical insurance companies face powerful forces seeking to restrict their ability to charge premiums based upon the anticipated risks of providing coverage to different individuals. A variety of different methods, such as community rating and waivers for pre-existing conditions, have been imposed on the medical insurance industry in an attempt to make as many persons as possible eligible for coverage. Professor Epstein explores how these efforts discriminate against younger, healthier persons by forcing them to pay higher insurance premiums to subsidize individuals with greater health risks. The incentives for persons to engage in more healthy behaviors, such as losing weight or giving up smoking, are reduced when they are shielded from the higher medical insurance premiums that would result from such unhealthy or dangerous behaviors under a free market medical insurance system.