Disability, chronic illness, and risk selection.

Area of Science:

• Health Economics
• Disability Studies
• Insurance Law

Background:

• Individuals with disabilities and chronic conditions are high-cost health care users, making them susceptible to risk selection in insurance.
• Preferred risk selection by insurers can limit access to coverage for high-risk individuals.
• Adverse selection, where high-risk individuals choose generous plans, can destabilize insurance markets.

Purpose of the Study:

• To analyze the multifaceted issue of risk selection in health insurance from a disability perspective.
• To identify necessary components for addressing risk selection equitably for individuals with disabilities.
• To propose solutions that ensure fair market conditions and prevent discrimination in health insurance.

Main Methods:

• Analysis of existing insurance practices and regulations, including the Americans with Disabilities Act.
• Examination of the impact of risk selection on individuals with disabilities and the healthcare market.
• Review of potential risk adjustment mechanisms sensitive to disability-related healthcare costs.

Main Results:

• The Americans with Disabilities Act offers partial protection but does not eliminate all disability-based distinctions in insurance.
• Risk selection poses significant threats to both access to coverage for high-risk individuals and the financial stability of responsive insurance plans.
• Effective solutions require a balanced approach that accounts for healthcare costs, prevents adverse selection, avoids stigma, and promotes market fairness.

Conclusions:

• Addressing risk selection is crucial for maintaining a viable market-based healthcare system that serves individuals with disabilities.
• Risk adjustment strategies, such as those based on prior expenditures or disability-sensitive diagnostic indicators, may be effective.
• Future reforms must prioritize equity, non-discrimination, and the specific healthcare needs of people with disabilities.