[EQ] High-Powered Incentives in Developing Country Health Insurance

High-Powered Incentives in Developing Country Health Insurance:

Evidence from Colombia’s ‘Régimen Subsidiado’

Grant Miller, Stanford Medical School and National Bureau of Economic Research (NBER)
Diana Pinto, Pontificia Universidad Javeriana School of Medicine and Fedesarrollo - Colombia
Marcos Vera-Hernández, University College London and Institute for Fiscal Studies (IFS)

October 2009

High-Powered Incentives in Developing Country Health Insurance:

Evidence from Colombia’s Regimen Subsidiado http://bit.ly/cGMpcU

 

Available online PDF [57p.] at: http://bit.ly/cGMpcU

“…..Despite current emphasis on health insurance expansions in developing countries, inefficient consumer incentives for over-use of medical care are an important counterbalancing concern. However, three factors that are more acute in poor countries (credit constraints, principal-agent problems, and positive externalities) result in substantial under-use and misuse as well.

 

This paper studies Colombia’s Régimen Subsidiado, the first major developing country effort to expand insurance in a way that purposefully addresses these inefficiencies. Using a regression discontinuity design, we find that Colombia’s insurance program has provided risk protection while substantially increasing the use of traditionally under-utilized preventive services (with measurable health gains) through high-powered supply-side incentives….”

 

Winners of the Inter-American Award for Research on Social Security 2010

 

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