|The state also created a reinsurance fund that taxes all health plans by $4 a month. If someone ends up requiring extremely expensive care, the fund picks up some of the costs|
Reinsurance is a good idea - it is catastrophic insurance for insurers.
What is not so clear, is why not use existing secondary insurers, like Lloyd's, who could do it probably better and cheaper. Why should the state go through the trouble of creating and running a new insurance company? Could it be because politicians like to keep their hands on OPM?