Date and Time
February 11, 2009
1:30 PM - 3:00 PM

Availability
Open to the public
No RSVP required

Speaker
Grant Miller - Stanford University

In developing countries, medical costs associated with unexpected illness are an important source of economic risk confronting households. Health insurance expansions are therefore a public policy priority, but they also produce socially undesirable consumer incentives for wasteful medical care use. This paper studies the first major developing country effort (Colombia's Régimen Subsidiado) to promote efficient consumption under health insurance without sacrificing risk-protection. Using a regression discontinuity approach, we find that by improving supply-side incentives through high-powered health insurance contracting, Colombia has provided risk protection with minimal wasteful consumption - and it has also increased the use of services with positive externalities.