There is a serious justice issue here as well. When we all get dumped in the same insurance pool by fiat, suddenly the free choice of one person imposes costs on other people.
For instance, let’s say a person who wants to eat lots of junk food.
Now, obviously, there is a moral hazard problem: if he doesn’t bear the full cost of the medical care required to fix his clogged arteries, then he might start consuming even more junk food, requiring even more medical care. This is always a problem with better medical technology: it allows you live more recklessly. That’s actually a GOOD thing: but when coupled with a form of nationalized coverage, it’s way too much of a good thing.
But that’s not primarily what I’m interested in here. The overlooked problem is that, because the nationalized system artificially makes this man’s consumption an externality on others, suddenly the government has a “rationale” for intruding in markets. Suddenly, the government is going to think it a great idea to tax or otherwise regulate junk food. More generally, to regulate everyone’s lifestyle so as to keep it within whatever it considers the “proper” behavior to avoid excessive medical cost to others. That’s another hidden danger oft forgotten. I want to be able to live my life without imposing extra costs on others, which is precisely why I don’t want to be forced to buy into an insurance pool I don’t belong in, or give the government an excuse to regulate my lifestyle choices that LOOKS like it’s just good public economics, but only because it was forced upon me to begin with.