Quality healthcare and health insurance retention: Evidence from a randomized experiment in the Kolkata slums
Delavallade, Clara
Jun 2014 · IFPRI Discussion Paper Book 1 · Intl Food Policy Res Inst
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Healthcare in developing countries is often unreliable and of poor quality, thus reducing individuals incentives to use quality health services. This paper examines an innovative approach to access to and demand for quality health care from the poor. Using data from a field experiment in India, I examine the impact of high-quality care experiences in the form of a free medical consultation with a qualified nongovernmental organization doctor, randomly offered by a health insurance provider to a subset of its enrollees. The effects are twofold. First, receiving this additional benefit raises enrollees willingness to pay to renew health insurance by 51 percent. This impact appears mostly at the extensive margin and is driven by a perceived income shock, as well as increased satisfaction with the scheme and trust in the insurance provider. In addition, exposed individuals are 12 percentage points more likely to consult a qualified practitioner when ill two months after the free consultation. Providing some initial quality care thus improves the demand for quality healthcare through two different pathwaysfirst by improving health insurance retention and second by raising the subsequent use of quality health services.
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