There are two ways to calculate health insurance as a actuary: As damage insurance: You combine the cost ratio of a certain group - here: age groups - and assign them with a price. In health insurance that means young age groups are cheap, older ones get more expensive due to their increased use of medical care. Like life insurance: You consider the statistically assumed life expectancy of an individual, sum up the expected medical expenses until then and divide the sum by the number of months until then (simplified). This way you achieve a stable premium that will only change if your calculation base changes (medical inflation or significant change of life expectancy). You will then need to establish a system to invest and manage the money paid by your younger crowd on top of the actual medical cost and make sure it's used to stabilize the premiums over a long period of time. This is what health insurance providers in Germany do - with billions of Euros invested in those ageing reserves. Currently this type of health insurance calculation is nowhere else to be found on the global market.