The Challenges of Universal Health Insurance in Developing Countries: Experimental Evidence from Indonesia’s National Health Insurance

Abhijit Banerjee, Amy Finkelstein, Rema Hanna, Benjamin A Olken, Arianna Ornaghi, Sudarno Sumarto
Externally Published Content, June, 2021, Final
Source: American Economic Review (Forthcoming)

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To investigate barriers to universal health insurance in developing countries, we designed a randomized experiment involving about 6,000 households in Indonesia who are subject to a government health insurance program with a weakly enforced mandate. Time-limited subsidies increased enrollment and attracted lower-cost enrollees, in part by reducing the strategic timing of enrollment to correspond with health needs. Registration assistance also increased enrollment, but increased attempted enrollment much more, as over half of households who attempted to enroll did not successfully do so. These findings underscore how weak administrative capacity can create important challenges in developing countries for achieving widespread coverage.

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