Insurance companies already have those undertreatment incentives, but it’s hard to act on them. Right now, people know that their insurance companies would love to provide self-serving "end of life" counseling that would encourage sick people not to waste so much valuable money. But they are limited by, first, competition–an insurance company that tried to do this too blatantly would suffer horrible publicity and ultimately lose business–and second, the threat of lawsuits and/or regulation.
Meanwhile, back on the ranch:
You have no idea what it’s like to be called into a sterile conference room with a hospital administrator you’ve never met before and be told that your mother’s insurance policy will only pay for 30 days in ICU. You can’t imagine what it’s like to be advised that you need to “make some decisions,” like whether your mother should be released “HTD” which is hospital parlance for “home to die,” or if you want to pay out of pocket to keep her in the ICU another week. And when you ask how much that would cost you are given a number so impossibly large that you realize there really are no decisions to make. The decision has been made for you. "Living will" or no, it doesn’t matter. The bank account and the insurance policy have trumped any legal document.
Offer end of life counseling = Insurance PR Armageddon
ICU eviction notice = something you do before you head out for happy hour at El Torito.