The Prices in the Crises: What We Are Learning from Twenty Years of Health Insurance in Low- and Middle-Income Countries

Jishnu Das and Quy-Toan Do

No 30996, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Governments in many low- and middle-income countries are developing health insurance products as a complement to tax-funded, subsidized provision of health care through publicly operated facilities. This paper discusses two rationales for this transition. First, health insurance would boost fiscal revenues for health care, as post-treatment out-of-pocket payments to providers would be replaced by pre-treatment insurance premia to health ministries. Second, increased patient choice and carefully designed physician reimbursements would increase quality in the health care sector. This essay shows that, at best, these objectives have only been partially met. Despite evidence that health insurance has provided financial protection, consumers are not willing to pay for unsubsidized premia. Health outcomes have not improved despite an increase in utilization. We argue that this is not because there was no room to improve the quality of care but because behavioral responses among health care providers have systematically undermined the objectives of these insurance schemes.

JEL-codes: I11 I12 I13 I15 O12 (search for similar items in EconPapers)
Date: 2023-03
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Published as Jishnu Das & Quy-Toan Do, 2023. "The Prices in the Crises: What We Are Learning from 20 Years of Health Insurance in Low- and Middle-Income Countries," Journal of Economic Perspectives, vol 37(2), pages 123-152.

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