What is likely to occur if health insurance companies are mandated to cut their prices by 30%?

If health insurance companies are mandated to cut their prices by 30%, it is likely that fewer people will be covered. The reasoning behind this is based on the dynamics of supply and demand in the health insurance market. When prices are reduced significantly, insurers may face lower profit margins, which could lead to a reduction in the number of plans offered or a decrease in the benefits of the plans to maintain profitability. This restructuring can create a less attractive market for insurers, and some may exit the market altogether, resulting in fewer coverage options for consumers. Consequently, the individuals who may have been able to afford insurance at previous pricing may find that the remaining plans do not meet their needs or that they are no longer available.

Additionally, with tighter profit margins, companies might be incentivized to limit coverage, raise deductibles, or impose stricter eligibility criteria, further leading to a reduction in the number of people who have access to coverage. Thus, while lower prices might seem beneficial at first glance, the potential negative impacts on the supply side of the health insurance market can ultimately result in fewer individuals being covered.