Ex-ante moral hazard? Overweight and health insurance expansion in Mexico

Joan Costa-Font, Mario Györi and Belen Saenz De Miera

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Extending health insurance coverage to previously uninsured populations can improve access to preventive services by relaxing financial barriers to health information and care, including those related to weight management. However, in the presence of ex-ante moral hazard, insurance coverage may weaken incentives for preventive effort, potentially increasing unhealthy behaviours. This paper examines this phenomenon using evidence from the introduction of a universal public insurance program, namely Mexico’s Seguro Popular (SP), in the 2000s. We exploit plausibly exogenous variation in the rollout of SP across municipalities generated by differential implementation speeds. We find no evidence that the rollout of SP modified individuals’ body mass index (BMI) or obesity status. Further, heterogeneity analysis suggests that SP exposure leads to a significant reduction in BMI among individuals who were already overweight at baseline, and a 2 percentage point decline in smoking prevalence, consistent with the hypothesis that SP increased access to preventative health information. These results suggest no evidence of ex-ante moral hazard in weight-related health behaviours after the expansion of universal insurance.

Keywords: obesity; overweight; insurance expansion; Seguro Popular; ex-ante moral hazard; income effects; prevention; health behaviours (search for similar items in EconPapers)
JEL-codes: I18 J50 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2026-06-11
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Published in Geneva Papers on Risk and Insurance: Issues and Practice, 11, June, 2026. ISSN: 1018-5895

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