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The Challenges of Universal Health Insurance in Developing Countries PDF
By:Abhijit V. Banerjee,Amy Finkelstein,Rema Hanna,Benjamin A. Olken,Arianna Ornaghi,Sudarno Sumarto
Published on 2019 by
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To assess ways to achieve widespread health insurance coverage with financial solvency in developing countries, we designed a randomized experiment involving almost 6,000 households in Indonesia who are subject to a nationally mandated government health insurance program. We assessed several interventions that simple theory and prior evidence suggest could increase coverage and reduce adverse selection: substantial temporary price subsidies (which had to be activated within a limited time window and lasted for only a year), assisted registration, and information. Both temporary subsidies and assisted registration increased initial enrollment. Temporary subsidies attracted lower-cost enrollees, in part by eliminating the practice observed in the no subsidy group of strategically timing coverage for a few months during health emergencies. As a result, while subsidies were in effect, they increased coverage more than eightfold, at no higher unit cost; even after the subsidies ended, coverage remained twice as high, again at no higher unit cost. However, the most intensive (and effective) intervention - assisted registration and a full one-year subsidy - resulted in only a 30 percent initial enrollment rate, underscoring the challenges to achieving widespread coverage.
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