Re "Health insurance options dwindle for self-employed," March 27

I hope Gov. Arnold Schwarzenegger reads this report about the effect of outlawing underwriting in California's market for association health plans a decade ago. Forbidding insurers to consider preexisting conditions supposedly protects those citizens. In fact, it victimizes everyone by allowing healthy people to wait until they get sick to apply for coverage. This causes a death spiral whereby healthy people quit association health plans and buy individual health insurance instead. Schwarzenegger wants to destroy the latter market too by imposing the same rule. Good health policy should encourage people to buy low-cost health insurance when they are young and healthy. The governor's plan does the opposite, and it will cause rate increases that will prove impossible for many to bear.

JOHN R. GRAHAM
Director Health Care Studies
Pacific Research Institute
San Francisco