Effort to avoid the adverse selection death spiral

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In an effort to avoid the adverse selection death spiral, a private health insurer offers two health insurance policies: one that is intended for those who are more likely to require expensive treatment (and therefore charges a higher premium) and one that is intended for those who are less likely to require treatment (and therefore charges a lower premium). Could this system overcome the problem created by adverse selection?

Reference no: EM13885532

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