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The Impact of Health Insurance Programs on Out-of-Pocket Expenditures in Indonesia: An Increase or a Decrease?

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  • Budi Aji

    (Institute of Public Health, Faculty of Medicine, University of Heidelberg, Im Neuenheimer Feld 324, Heidelberg 69120, Germany
    School of Public Health, Faculty of Medicine and Health Sciences, Jenderal Soedirman University, Kampus Karangwangkal, Purwokerto 53123, Indonesia)

  • Manuela De Allegri

    (Institute of Public Health, Faculty of Medicine, University of Heidelberg, Im Neuenheimer Feld 324, Heidelberg 69120, Germany)

  • Aurelia Souares

    (Institute of Public Health, Faculty of Medicine, University of Heidelberg, Im Neuenheimer Feld 324, Heidelberg 69120, Germany)

  • Rainer Sauerborn

    (Institute of Public Health, Faculty of Medicine, University of Heidelberg, Im Neuenheimer Feld 324, Heidelberg 69120, Germany)

Abstract

We used panel data from the Indonesian Family Life Survey to investigate the impact of health insurance programs on reducing out-of-pocket expenditures. We employed three linear panel data models, two of which accounted for endogeneity: pooled ordinary least squares (OLS), pooled two-stage least squares (2SLS) for instrumental variable (IV), and fixed effects (FE). The study revealed that two health insurance programs had a significantly negative impact on out-of-pocket expenditures by using IV estimates. In the IV model, Askeskin decreased out-of-pocket expenditures by 34% and Askes by 55% compared with non- Askeskin and non- Askes , respectively, while Jamsostek was found to bear a nonsignificant effect on out-of-pocket expenditures. In the FE model, only Askeskin had a significant negative effect with an 11% reduction on out-of-pocket expenditures. This study showed that two large existing health insurance programs in Indonesia, Askeskin and Askes , effectively reduced household out-of-pocket expenditures. The ability of programs to offer financial protection by reducing out-of-pocket expenditures is likely to be a direct function of their benefits package and co-payment policies.

Suggested Citation

  • Budi Aji & Manuela De Allegri & Aurelia Souares & Rainer Sauerborn, 2013. "The Impact of Health Insurance Programs on Out-of-Pocket Expenditures in Indonesia: An Increase or a Decrease?," IJERPH, MDPI, vol. 10(7), pages 1-19, July.
    • Handle: RePEc:gam:jijerp:v:10:y:2013:i:7:p:2995-3013:d:27318
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    References listed on IDEAS

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    2. Kalyan Kolukuluri, 2022. "Healthcare utilization and outcomes for insured dependent children: evidence from Indonesia," Empirical Economics, Springer, vol. 63(2), pages 945-977, August.
    3. Long Thanh Giang & Tham Hong Thi Pham & Phong Manh Phi & Nam Truong Nguyen, 2023. "Healthcare Services Utilisation and Financial Burden among Vietnamese Older People and Their Households," IJERPH, MDPI, vol. 20(12), pages 1-13, June.

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