The insurance functions of Blue Cross and Blue Shield plans were pretty simple in their early years. The plans engaged in community rating. This simply meant that all of the subscribers of a plan were in one large risk pool. Insurance premiums were determined essentially by projecting the growth of insurance claims and dividing by the number of subscribers. Commercial insurers began to challenge this in the 1950s through experience rating, and by the 1960s, experience rating had driven out community rating. (more…)

Because Medicaid is designed to provide coverage for people with low incomes, there are medicaid rules in place to make sure people do not just give away their assets to become eligible. If these rules did not exist, even a millionaire could transfer all of his or her assets to a relative today and become eligible for Medicaid tomorrow. (more…)