Which practice helps health insurance companies overcome the problem of adverse selection?

Question

Quizplus · Accepted Answer

The experience rating system helps health insurance companies to overcome the adverse selection problem. Under this system, insurance premiums are based on the individual's past health care usage, which helps to prevent healthy individuals from subsidizing unhealthy individuals. Selling insurance only to healthy or unhealthy people (options A and B) would only exacerbate adverse selection.

Which Practice Helps Health Insurance Companies Overcome the Problem of Adverse