> Why should a profit-seeking insurance company insure me past some point
Seems like a good argument for single payer insurance.
Seems like a good argument for single payer insurance.
Correct. And whoever is more efficient wins. That's no different from any other retail business. My grocery store sells lettuce to anybody. Some are more efficient and can offer better prices. Or they sell better lettuce. But regulation sets minimum requirements so nobody can sell fake or toxic lettuce.
I thought that's how the market works.
However, due to the nature of insurance, even a relatively small number of people developing expensive conditions can be catastrophic. Remember, in your scenario, you are REQUIRED to cover them.
If you're going to have only one combined risk pool, you need to be able to guarantee coverage even facing catastrophic insurance costs. The only real way to do this is to be backed by somebody with very, very deep pockets, like, say, the federal government.
Checkout adverse selection and moral hazard.