The conservative view of alcoholism, Freud meets Jesse Jackson, insanity on the ropes. TRUTH IN INSURANCE
By Daniel Seligman REPORTER ASSOCIATE Alan Deutschman

(FORTUNE Magazine) – One of the strangest political movements of modern times seems to be running out of steam. The movement, which successfully defied the laws of logic until quite recently, was directed against insurance companies. Its main point: preventing the companies from testing prospective policyholders for the AIDS virus. The movement's successes are now on display in three states and the District of Columbia. At this moment, all four have laws that either ban HIV tests or prevent the companies from acting on test results. But in all four the laws are crumbling: --In California, the state senate and assembly have voted for repeal, possibly because the voters were about to throw out the law anyway. (An initiative calling for AIDS testing in insurance and other contexts will be on the ballot in November.) --In Massachusetts the Dukakis administration first imposed an outright ban on AIDS testing by insurance companies, then issued regulations that allowed some testing but required companies to issue life policies of up to $100,000 without a test. The state government is now watching in dismay as a federal judge bars enforcement of this rule. --New York, which also has a law requiring the companies to give policies to those who test positive, is currently appealing a court decision that said the law was ''arbitrary and capricious.'' --The District of Columbia still has on its books a law, passed in 1986, that bans all testing. Observing that no insurance was being written in Washington, the Senate is now threatening to withhold next year's appropriations unless the local government repeals the law. The House has not yet been heard from, however, so there remains a slight chance that this insane regulation will survive a bit longer.

How could such laws be justified? AIDS victims suffer tragically, but so do millions of cancer patients obliged to tell all and undergo tests for insurance (which they often cannot get). Why should AIDS be uniquely exempt from the logic of insurance? % Although the laws are insane, we assume that the solons who passed them were being rational. They knew that the gay rights movement has a lot of clout and should not be offended if possible. But they also knew that the laws couldn't possibly last and they hoped, quite plausibly, that somebody else would come along to take the heat for getting rid of them. Which is what happened. In all four jurisdictions, you will observe, there is now an ''external force'' -- a voter initiative, a judge, a Senate committee -- in the picture and pushing for change. The federal system may not be perfect, but it definitely puts limits on the amount of insanity allowed.