Health insurance reform impact on children’s educational attainment: evidence from Vietnam

Research has shown that parental health shocks and child health status each exert measurable effects on child educational attainment, particularly in low-middle income countries. In 2005, the Vietnamese government enacted a new health insurance policy increasing the proportion of population covered by health insurance from 22% of total population to approximately 43%. Using a quasi-experimental setup and a difference-in-differences (DID) approach, this paper examines the unintended effects of health insurance reforms on children’s educational outcomes. Because households in the state sector were almost unaffected before and after the reform, children in that group served as a natural control group, whereas children growing up in non-state employed households formed a treatment group. Educational outcomes were measured for three levels of general education: primary, secondary and high school. Results showed that the NHI reform improved educational outcomes for children in high school, both in terms of enrollment and school completion likelihood. We found a stronger effect on school enrollment rather than school completion. These findings are the first of their kind using the nationally representative data and would be of value to policy makers in countries that plan to adopt a similar health policy.