Abstract:
Health micro insurance offers a promising mechanism to protect the poor against risk and vulnerability. We study the impact of physical distance to hospitals on utilization of health services in the context of the Kashf Health Micro Insurance (HMI) Program in Punjab, Pakistan. We address three main research questions; first, what is the impact of physical distance on choice of health facility? Second, is the burden of physical distance greater for women? Third, whether the spread positive information influencing perceptions of quality could be a possible mechanism through which, the burden of distance may be reduced? We employ a Probit model with administrative data on hospitalization claims between 2014 to 2017. Our findings show that as distance to panel facilities increases, individuals are more willing to make out of pocket expenditures at nearby non panel hospitals. Therefore, distance impedes individuals from making panel claims. Moreover, this negative impact of distance is more pronounced for women.Furthermore, we find that positive information influencing these perceptions regarding better quality of treatment at panel facilities helps in raising the incentive for individuals, especially women, to use panel facilities for treatment.
