Date of Award

Spring 5-2019

Document Type

Honors Thesis

Degree Name

Bachelor of Arts



Advisor/Committee Chair

Dr. Pinka Chatterji


Under the Patient Protection and Affordable Care Act, signed into law by President Obama in 2010, health insurance coverage was expanded to 20 million previously uninsured people. Of these, 14.5 million were Medicaid eligible. Moral Hazard, a common research topic in insurance, is defined as when the private actions of an individual in a risk-sharing situation influence the probability of the outcome. There are two types of moral hazard, called ex-post moral hazard and ex-ante moral hazard. In the case of health insurance, ex-post moral hazard is when a health behavior changes after an individual becomes insured. Ex-ante moral hazard, which is what is being investigated in this paper, is when a behavior changes and potentially causes a health event. This paper considers that ex-ante moral hazard developed in the portion of the population insured by Medicaid following its expansion in 24 states. A difference-in-difference model is used to compare these 24 states to the 18 that have not voted to expand Medicaid. There are eight states which are excluded from the model because the legislatures of these states voted to expand Medicaid after the January 1, 2014 deadline. The data came from the Behavioral Risk Factor Surveillance System, which is maintained by the Centers for Disease Control. I examine the rate of seat belt use as a risky health behavior in expansion states versus non-expansion states to determine if there is a difference resulting from moral hazard. Results show that there is no decrease in seatbelt use associated with the expansion of Medicaid.

Included in

Economics Commons