Many states have laws requiring that health insurance policies cover the treatment of diabetes. One study found that after the passage of these laws, diabetics became fatter, which complicates the treatment. This study's finding is an example of:

Question

Quizplus · Accepted Answer

The study's finding is an example of moral hazard, which occurs when individuals change their behavior in a riskier way because they are protected from the consequences of that risk, in this case, by health insurance covering diabetes treatment.

Many States Have Laws Requiring That Health Insurance Policies Cover