This is as it should be. Initially offered by unions, it was expanded to circumvent wage and price controls. Insurance only makes sense if it is profitable. And it's only profitable when the insurer pays out less in claims than he takes in through premiums. To do that, he must put together risk pools of people who will, on average, cost less than their payments.
Otherwise insurance is only a mistake or, in the case of government, a welfare subsidy.
Under subsidized insurance, a vast amount of health resources are used up by government on people who prefer crack cocaine to fresh fruit, or television to a brisk walk. This makes neither moral not economic sense. Every time a new socialist proposal is advanced, I turn to Ludwig von Mises's Socialism . Written in 1922, it's still the best guide to the schemes of the Left. In short, it is an institution which tends to encourage disease, not to say accidents, and to intensify considerably the physical and psychic result of accidents and illnesses.