The impact of health insurance on out-of-pocket expenditure on delivery in Indonesia

Abstract

In this study, we estimate the effects of health insurance on the out-of-pocket expenditure on health care for maternal delivery in Indonesia. Distinguishing between the types of health insurance, we explore heterogeneity in the size of the impact of noncontributory insurance for poor households vis-à-vis contributory insurance for nonpoor households. We find that noncontributory insurance and contributory insurance reduce the average out-of-pocket expenditure by 1,136,966 IDR ($p<0.01$) and 676,402 IDR ($p<0.05$), respectively. Also, larger impacts of noncontributory insurance and contributory insurance are found at the right tail of the distribution.

Notes

Notes

1 Specifically, in firms with at least 10 employees and with a minimum wage of 1 million IDR per month.

2 Inpatient care is limited to public hospitals.

3 Jamkesmas is a successor of Askeskin. Askeskin was renamed Jamkesmas in 2008.

4 Four provinces in Sumatra (North Sumatra, West Sumatra, South Sumatra, and Lampung), all five of the Javanese provinces (DKI Jakarta, West Java, Central Java, DI Yogyakarta, and East Java), and four provinces covering the remaining major island groups (Bali, West Nusa Tenggara, South Kalimantan, and South Sulawesi) are included (Strauss, Witoelar, & Sikoki, 2016).

5 The living standards index is created by the principal component analysis of the following variables: whether a household has access to electricity; whether a household has access to piped water; whether a household owns a septic toilet; whether a household uses safe energy for cooking (electricity or gas); whether a household’s disposed garbage is collected by a sanitation service; and whether a household uses a fridge for perishable foods.

6 Wealth is defined as the aggregated total value of the following various assets that are commonly found in typical Indonesian households: house and land occupied by a household; other house/building (including land); land (not used for farming); poultry; livestock/fish pond; hard stem plant not used for farming or a non-farm business; vehicles (cars, boats, bicycles, or motorbikes); household appliances (radio, tape recorder, television, fridge, sewing or washing machine, video and CD player, cell phone, etc.); savings/certificates of deposits/stocks; receivables; jewellery; and household furniture and utensils.

7 Household income includes farm income, non-farm income, and nonlabor income.

8 The Beras Untuk Rakyat Miskin (RASKIN) program was introduced as an emergency food security program in 1998; it delivers rice to be purchased at subsidised prices, prioritising poor and near-poor households (World Bank, 2012). The Program Keluarga Harapan (PKH) is intended to improve the welfare of extremely poor households by providing them with cash transfers quarterly.