Conditional cash transfers and health: unpacking the causal chain

This paper investigates whether conditional cash transfer (CCT) programmes that include health and nutrition components improve health and nutritional outcomes, and if so, which components of the programmes, or combination thereof, are important in achieving these improvements. Using evidence from Latin America, Africa, Asia and the Middle East, the paper adopts a theory-based approach that spells out the assumptions behind the expectation that the CCT interventions will have a measurable impact on health and nutrition outcomes. CCT impact evaluations provide unambiguous evidence that financial incentives work to increase utilisation of those key health services by the poor upon which the cash transfer is conditioned, if the beneficiaries have knowledge of this condition. However, results are mixed with respect to nutrition and health outcomes, suggesting that encouraging utilisation when the pertinence of services is unknown or of poor quality may not produce the expected effects. Incipient results from Mexico indicate, however, that service quality is not necessarily exogenous to the programme, but may be positively affected by giving the poor women skills, information, and social support to negotiate better care from healthcare providers. Findings from Mexico indicate that there are direct routes by which the cash transfers affect health, outside of the health sector interactions. In particular, the poverty alleviation achieved with the cash transfers may affect the mental health of beneficiaries, as well as their lifestyle choices. The main policy recommendation that ensues from this review is the need to find the right mix of incentives and regulation to improve the quality of care, while at the same time investing in the empowerment of users. Future research that explores the relative cost-effectiveness of investing in the supply versus the demand-side within the health system will be crucial, along with further research on the need for conditionalities. Other areas that could benefit from further evidence include morbidity outcomes from programmes other than Oportunidades, including mental health and chronic disease, impacts on health-related behaviours and attitudes, and how these factors affect outcomes, and the effects on out-of-pocket expenditure.