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The impact of price subsidies on child health care use : evaluation of the Indonesian healthcard

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  • Somanathan, Aparnaa
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    Abstract

    Financial barriers to seeking care are frequently cited as one of the main causes of underutilization of child health care services. This paper estimates the impact of Indonesia's healthcard on health care use by children. Evaluation of the healthcard effect is complicated by the fact that card allocation was non-random. The analysis uses propensity score matching to control for systematic differences between treatment and control groups. A second potential source of bias is related to contemporaneous, exogenous influences on health care use unrelated to the healthcard itself. Using panel data collected prior to and after the introduction of the healthcard, a difference-in-differences estimator is constructed to eliminate the effects of exogenous changes over time. The author finds that although health care use declined for all children during the crisis years of 1997-2000, use of public sector outpatient services declined much less for children with healthcards. The protective effect of the healthcard on public sector use was concentrated among children aged 0-5 years. The healthcard had no significant impact on use of private sector services. The results highlight the need to provide adequate protection against the financial burden of health care costs, particularly during economic crises.

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    Bibliographic Info

    Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4622.

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    Date of creation: 01 May 2008
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    Handle: RePEc:wbk:wbrwps:4622

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    Keywords: Health Monitoring&Evaluation; Health Systems Development&Reform; Housing&Human Habitats; Health Economics&Finance; Population Policies;

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    1. Menno Pradhan & Fadia Saadah & Robert Sparrow, 2007. "Did the Health Card Program Ensure Access to Medical Care for the Poor during Indonesia's Economic Crisis?," World Bank Economic Review, World Bank Group, World Bank Group, vol. 21(1), pages 125-150.
    2. Elizabeth Frankenberg & James P. Smith & Duncan Thomas, 2003. "Economic Shocks, Wealth, and Welfare," Journal of Human Resources, University of Wisconsin Press, vol. 38(2).
    3. Lisa A. Cameron, 2001. "The Impact of the Indonesian Financial Crisis on Children: An analysis using the 100 villages data," Innocenti Working Papers inwopa01/10, UNICEF Innocenti Research Centre.
    4. Akin, John S, et al, 1986. "The Demand for Primary Health Care Services in the Bicol Region of the Philippines," Economic Development and Cultural Change, University of Chicago Press, vol. 34(4), pages 755-82, July.
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    7. Jalan, Jyotsna & Ravallion, Martin, 2001. "Does piped water reduce diarrhea for children in rural India ?," Policy Research Working Paper Series 2664, The World Bank.
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    9. Guido W. Imbens, 2003. "Nonparametric Estimation of Average Treatment Effects under Exogeneity: A Review," NBER Technical Working Papers 0294, National Bureau of Economic Research, Inc.
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    12. Rajeev H. Dehejia & Sadek Wahba, 1998. "Causal Effects in Non-Experimental Studies: Re-Evaluating the Evaluation of Training Programs," NBER Working Papers 6586, National Bureau of Economic Research, Inc.
    13. Heckman, James J & Ichimura, Hidehiko & Todd, Petra, 1998. "Matching as an Econometric Evaluation Estimator," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 65(2), pages 261-94, April.
    14. Sascha O. Becker & Andrea Ichino, 2002. "Estimation of average treatment effects based on propensity scores," Stata Journal, StataCorp LP, StataCorp LP, vol. 2(4), pages 358-377, November.
    15. Schwartz, J Brad & Akin, John S & Popkin, Barry M, 1988. "Price and Income Elasticities of Demand for Modern Health Care: The Case of Infant Delivery in the Philippines," World Bank Economic Review, World Bank Group, World Bank Group, vol. 2(1), pages 49-76, January.
    16. Wagstaff, Adam & Pradhan, Menno, 2005. "Health insurance impacts on health and nonmedical consumption in a developing country," Policy Research Working Paper Series 3563, The World Bank.
    17. Asep Suryahadi & Sudarno Sumarto & Lant Pritchett, 2003. "Evolution of Poverty During the Crisis in Indonesia," Asian Economic Journal, East Asian Economic Association, East Asian Economic Association, vol. 17(3), pages 221-241, 09.
    18. Heller, Peter S., 1982. "A model of the demand for medical and health services in Peninsular Malaysia," Social Science & Medicine, Elsevier, Elsevier, vol. 16(3), pages 267-284, January.
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