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The effects of a fee-waiver program on health care utilization among the poor : evidence from Armenia

  • Chaudhury, Nazmul
  • Hammer, Jeffrey
  • Murrugarra, Edmundo

This study examines the impact of a fee-waiver program for basic medical services on health care utilization in Armenia. Because of the reduction in public financing of health services and decentralization and increased privatization of health care provision, private out-of-pocket contributions are increasingly becoming a significant component of health costs in Armenia. To help poor families cope with this constraint, the Armenian government provided a free-of-charge basic package service to eligible individuals in vulnerable groups, such as the disabled and children from single parent households. Drawing on the 1996 and 1998-99 Armenia Integrated Survey of Living Standards (AISLS), which allows the identification of eligible individuals under this program, the authors estimate the impact of the fee-waiver program on utilization of health services, particularly among the poor. Across the two survey rounds utilization rates have indeed declined despite comparable levels of income, and this decline has occurred among both the poor and the rich, with average utilization falling by 12 percent between the two surveys. But families with four or more children, the largest beneficiary group under the"vulnerable population"program, have decreased their use of health care services in a disproportionate manner-21 percent reduction in use between the two survey rounds. This precipitous drop in health care use by this vulnerable group, despite being eligible for free medical services, suggests that the program was inadequate in stemming the decline in the use of health services. The authors further present evidence to suggest that the free-of-charge eligibility program acts more like an income transfer mechanism, particularly to disabled individuals.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 2952.

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Date of creation: 31 Jan 2003
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Handle: RePEc:wbk:wbrwps:2952
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  1. Strauss, John & Thomas, Duncan, 1996. "Measurement and Mismeasurement of Social Indicators," American Economic Review, American Economic Association, vol. 86(2), pages 30-34, May.
  2. Anne Case & Angus Deaton, 2002. "Consumption, health, gender and poverty," Working Papers 197, Princeton University, Woodrow Wilson School of Public and International Affairs, Research Program in Development Studies..
  3. World Bank, 2002. "Armenia : Poverty Update," World Bank Other Operational Studies 15320, The World Bank.
  4. Lanjouw, Jean Olson & Lanjouw, Peter, 2001. "How to Compare Apples and Oranges: Poverty Measurement Based on Different Definitions of Consumption," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 47(1), pages 25-42, March.
  5. Dow, W & Gertly, P & Schoeni, R-F & Strauss, J & Thomas, D, 1997. "Health Care Prices, Health and Labor Outcomes : Experimental Evidence," Papers 97-01, RAND - Labor and Population Program.
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