I’m the daughter and sister of insurance agents. I understand that an insurance program is an agreement to provide buyers of insurance with funds to overcome some kind of misfortune. Examples include automobile accidents, house fires, and illnesses, to name a few.
For the insurance provider not to go broke, payments into the insurance program must be enough to accumulate funds needed to pay out for the misfortunes.
A provider of automobile accident insurance would soon go broke if the provider allowed people to begin the insurance after having an accident. Likewise, so would a company providing house insurance if people were allowed to begin fire insurance after having a fire and expecting to receive funds.
In a sense, insurance programs are community programs. Some are profit driven. Others, like social security for the elderly, are not. Even with social security, however, workers are required pay into social security whether they know they will live to old age or not.
Popular sections of the Affordable Care Act (ACA, or Obamacare) include the provisions covering preexisting conditions and those guaranteeing people’s continued coverage even if they get sick.
Highly unpopular, however, is the mandate that all must purchase health insurance or pay a penalty.
Unfortunately, adopting a plan with the first two requirements is most likely impossible unless all people are required to have a policy or pay a penalty. Health insurance, no more than car or house insurance, needs regular payments over a long period of time to balance the outgoing.
Otherwise, it becomes too expensive. The cost of caring for sick people is too expensive unless a large group of people pay for coverage.
Of course, people with health insurance are more likely to enjoy good health than people without it.
If their insurance covers doctor visits, they are more likely to have regular checkups. They are more likely to visit a doctor when they first have symptoms of an illness rather than later when the illness may require longer and more expensive treatment.
The term”health” insurance is instructive. The primary goal is better health, rather than paying to correct ill health. It’s also less expensive in the long run.