Re-examining the effects of public health insurance: The case of nonpoor children in Vietnam

This paper focuses on the effects of a 2005 health insurance reform in Vietnam. Through this reform, public health insurance was newly offered to nonpoor children under 6 years old, but it required the use of community health facilities. This requirement potentially limited the value of the insurance. Employing difference-in-discontinuities and triple-difference methods and using data from 2002, 2004, and 2006, I show that, despite health coverage among nonpoor children increasing by nearly three times, there is little or no evidence that the reform significantly increased health care utilization, changed care locations from private to public sites, lowered out-of-pocket costs, or improved health status for nonpoor young children. My results suggest a "bypassing" phenomenon whereby nonpoor families skipped free health care at low-quality facilities.