The Problem of Adverse Selection in Health Insurance Leads to a Situation

Multiple Choice

The problem of adverse selection in health insurance leads to a situation in which:

A) health insurance covers inappropriate items for the population it serves.
B) overinsurance of the premium-paying population occurs.
C) underinsurance of the premium-paying population occurs.
D) the percentage of the premium-paying population that is healthy rises, squeezing unhealthy individuals out of the market.
E) the percentage of the premium-paying population that is unhealthy rises, squeezing healthy individuals out of the market.