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Analyses of enrolment, dropout and effectiveness of RSBY in northern rural India


  • Raza, Wameq
  • van de Poel, Ellen
  • Panda, Pradeep


In 2008, the Government of India initiated the Rashtriya Swasthya Bima Yojana (RSBY) to provide inpatient insurance coverage to all below-poverty-line (BPL) households in India. It is one of the most ambitious social protection programmes in the country. Using household level panel data from Uttar Pradesh and Bihar collected in 2012-2013, this paper investigates the determinants of enrolling in and dropping out of the scheme. In addition, we investigate whether participating in the RSBY is associated with a higher probability of using inpatient care and increased financial protection. We find that by the end of our survey period, close to half of our sample is enrolled in RSBY (41% in Bihar, 68% in UP). RSBY coverage is more concentrated among the poor in Bihar, as compared to UP. We find that the presence of chronic illnesses, lower socioeconomic status, belonging to scheduled-castes or tribes (SCST), insurance related awareness and proximity to healthcare facilities are positively correlated with enrolment. SCST households and households with members who have chronic conditions are less likely to drop out. The associations between RSBY membership and healthcare use and financial protection vary across the states. While we do not find that RSBY is associated with increased rates of utilization across the board, we do find insured households in Bihar experience lower out-of-pocket payments and debt following hospitalization. Nearly all hospitalizations among insured patients lead to positive OOP spending. Overall, we conclude that though the RSBY does appear to be pro-poor and is inclusive of disadvantaged minorities such as the SCST, the scheme suffers from adverse selection. The fact that drop-out rates are low might suggest good perceived value for the insured. The RSBY has the potential to play an important role in India’s move towards Universal Health Coverage. However, our analyses suggests that scheme awareness should be increased; that the targeting of the scheme could be improved, and that the programme is not yet providing cashless inpatient care. The differences in effectiveness between both states might be related to the recent development efforts made by the Bihar government, and suggestive of the need for addressing supply side constraints prior to launching an insurance scheme.

Suggested Citation

  • Raza, Wameq & van de Poel, Ellen & Panda, Pradeep, 2016. "Analyses of enrolment, dropout and effectiveness of RSBY in northern rural India," MPRA Paper 70081, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:70081

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    References listed on IDEAS

    1. Wagstaff, Adam & Lindelow, Magnus & Jun, Gao & Ling, Xu & Juncheng, Qian, 2009. "Extending health insurance to the rural population: An impact evaluation of China's new cooperative medical scheme," Journal of Health Economics, Elsevier, vol. 28(1), pages 1-19, January.
    2. Mebratie, Anagaw D. & Sparrow, Robert & Yilma, Zelalem & Alemu, Getnet & Bedi, Arjun S., 2015. "Enrollment in Ethiopia’s Community-Based Health Insurance Scheme," World Development, Elsevier, vol. 74(C), pages 58-76.
    3. Raza, W.A. & Panda, P. & Van de Poel, E. & Dror, D.M. & Bedi, A.S., 2013. "Healthcare Seeking Behavior among Self-help Group Households in Rural Bihar and Uttar Pradesh, India," ISS Working Papers - General Series 50172, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    4. Gabriela Flores & Jaya Krishnakumar & Owen O'Donnell & Eddy van Doorslaer, 2008. "Coping with health‐care costs: implications for the measurement of catastrophic expenditures and poverty," Health Economics, John Wiley & Sons, Ltd., vol. 17(12), pages 1393-1412, December.
    5. Kulbhushan Balooni & Kausik Gangopadhyay & Sudeep Turakhia & Karthik. R. G, 2011. "Challenges in the Sustainability of a Targeted Health Care Initiative in India," Working papers 93, Indian Institute of Management Kozhikode.
    6. Mebratie, A.D. & Sparrow, R.A. & Alemu, G. & Bedi, A.S., 2013. "Community-Based Health Insurance Schemes," ISS Working Papers - General Series 568, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
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    Cited by:

    1. Azam, Mehtabul, 2018. "Does Social Health Insurance Reduce Financial Burden? Panel Data Evidence from India," World Development, Elsevier, vol. 102(C), pages 1-17.

    More about this item


    RSBY; health insurance; India; enrolment; dropout; renewal; impact; rural;

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • I1 - Health, Education, and Welfare - - Health
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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