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High-Powered Incentives in Developing Country Health Insurance: Evidence from Colombia’s Régimen Subsidiado

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Author Info
Grant Miller
Diana M. Pinto
Marcos Vera-Hernández

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Abstract

Despite current emphasis on health insurance expansions in developing countries, inefficient consumer incentives for over-use of medical care are an important counterbalancing concern. However, three factors that are more acute in poor countries (credit constraints, principal-agent problems, and positive externalities) result in substantial under-use and misuse as well. This paper studies Colombia’s Régimen Subsidiado, the first major developing country effort to expand insurance in a way that purposefully addresses these inefficiencies. Using a regression discontinuity design, we find that Colombia’s insurance program has provided risk protection while substantially increasing the use of traditionally under-utilized preventive services (with measurable health gains) through high-powered supply-side incentives.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 15456.

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Date of creation: Oct 2009
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Handle: RePEc:nbr:nberwo:15456

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I10 - Health, Education, and Welfare - - Health - - - General
O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General

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This page was last updated on 2009-11-25.

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