Abstract |
Ghana introduced a social health insurance scheme in 2003. One of its motivations was to protect consumers against adverse health shocks. Financing for the programme comes from a 2.5% goods and service tax, contributions by formal sector workers directly transferred from their social security savings and individual premiums from informal members. This arrangement makes formal workers compulsory members of the scheme while informal members voluntarily enroll. We view this as a natural experiment in which one section of the population automatically acquires insurance (with formal sector employment), and the remainder choose to obtain the same coverage (or not). Using data from the 2009/2010 Ghana Socioeconomic Panel Survey, we explore the determinants of the uptake of health insurance by informal members and test whether this voluntary health insurance uptake impacts the frequency of use of health care resources. We find robust evidence that older, wealthier and more educated individuals are more likely to buy (voluntary) health insurance. Moreover, using the method of propensity score matching, we find that voluntary health insurance uptake is strongly associated with higher health care utilization-implying that, with respect to the frequency of use, the mode of insurance acquisition matters. |