"Private health insurance creates bad incentives, limits access, and so on. So that's bad. But given that it already exists I don't see what additional evil is created by allowing insurers to redistribute risk among each other in this way. (Allowing them to run wild with risk redistribution is what led to the crisis in the short run, but the devil's in the details.) Are the incentives to provide shitty care amplified by this practice? I don't see how they would be on first blush, but I'm willing to find that they are."
I anticipated a response along these lines, and I find myself of two minds. My left brain admires your high level of rationality. (Really. I take your point.) And my right brain pities you for the madness into which advanced capitalism has driven you. (But who of us is spared?)