Once again remember the insurance premium function.
P = (1+a)Lp, where:
a= administrative fee
L=Loss incured when insured event takes place (ie: cost of medical treatment)
p= Probability of insured event occurring
In this case p=1 and therefore there is no incentive for the insurer to accept such a cost, which would imply that the insurance company would charge an insurance premium that would be more costly that the treatment (given that it would charge an administrative fee as well as a margin of profit in the insurance premium). Fully private sector markets are, at least for the time being as idiotic an idea as fully publicly owned markets.
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