The purpose of insurance is to mitigate the risk of a very costly but unlikely outcome by paying a smaller amount over time, thereby spreading that risk among those of similar risk.
Not being able to consider individual risk means that insurance makes no sense for those with a low risk profiles, because they’re in the same cohort as those who will _definitely_ file claims.
There's levels of broken-ness to healthcare in the US. Even if you allow health insurance to discriminate based on health conditions, it will still be broken in other ways.
Employer health insurance rates fan still get wonky for small businesses though. It probably can't happen today, but I was at a small business where everyone's rates went up shortly after one person was diagnosed with cancer and another one or two with diabetes.
That is an example of it not really being individual insurance though. The insurance company is just lumping the employees together and setting rates based on the relative risk of the whole group, not dissimilar from getting an individual policy where the rates are based on a group of one.
Health insurance is intended to mitigate the risk of unexpected high costs, not pay for your normal healthcare.
You're thinking of a healthcare _plan_. Trying to make the insurance model fit where it doesn't work is the root of the vast majority of our issues in the US.