Catastrophic and impoverishing health expenditures in fragmented public health systems: lessons from Mexico, 2000–2022

Universal Health Coverage (UHC) requires that all individuals access comprehensive health services without facing financial hardship. Fragmented health systems, characterised by multiple uncoordinated financing schemes, can weaken financial risk protection and disproportionately expose vulnerable populations to out-of-pocket expenditures (OOP). Evidence on how fragmentation affects financial protection in Latin America is limited. This study examines the long-term trends in catastrophic, impoverishing, and excessive health expenditures in Mexico’s fragmented public health system. We analysed 470,104 households from the Mexican National Household Income and Expenditure Survey (ENIGH, 2000–2022), corresponding to an estimated 341 million household-wave observations nationally. Financial hardship was measured using standard indicators: catastrophic health expenditure (CHE), impoverishing health expenditure (IHE), and excessive health expenditure (EHE). Descriptive results used a more granular insurance breakdown, whereas the main analyses grouped households into four main public insurance categories: uninsured, Seguro Popular/INSABI, social security, and mixed public coverage. Heckprobit models estimated adjusted probabilities of financial hardship, accounting for selection among households with positive health expenditure. Analyses incorporated the complex survey design and expansion factors, and sensitivity analyses used alternative thresholds for CHE and EHE. Financial protection improved for most households between 2000 and 2014, particularly among Seguro Popular affiliates. After 2020, following the replacement of this public insurance scheme with INSABI, protection deteriorated, with CHE and EHE reaching their highest levels among mixed insurance households by 2022. Social security households consistently experienced the lowest financial burden, while uninsured and INSABI-affiliated households faced substantially higher risk. Increased use of private healthcare, especially for medicines, contributed to rising OOP. Sensitivity analyses confirmed these trends. Fragmentation in Mexico’s public health system has intensified inequalities in financial protection. The coexistence of multiple uncoordinated insurance schemes has failed to protect households from economic hardship —particularly those in the informal sector. Achieving meaningful UHC will require integrated financing reforms that standardise benefits, reduce administrative complexity, and address persistent gaps in service provision.