Has any thought been given to moral hazard?

Reader comment on: How Sickness Leads to Bankruptcy

Submitted by Andrew Terhune (United States), Mar 23, 2018 14:51

One feature (or flaw) of insurance of all sorts is "moral hazard", or the incentive to game the system. For instance, during the last recession, the number of workers claiming to be disabled expanded significantly. Now that workers are scarce and jobs plentiful, the disability rolls are coming down. Coincidence or are people merely responding to incentives inherent in claiming they are disabled? The more government mitigates the consequences of failing to plan for exigencies such as medical expenses, the less people will take measures on their own to ameliorate those consequences since they can always rely on the government program.

Note: Comments are moderated by the editor and are subject to editing.

Other reader comments on this item

Comment on this item