Long-run Consequences of Health Insurance Promotion When Mandates are Not Enforceable: Evidence from a Field Experiment in Ghana Patrick Opoku Asuming, Hyuncheol Bryant Kim, and Armand Sim May 2019 Abstract We study long-run selection and treatment effects of a health insurance subsidy in Ghana, where mandates are not enforceable. We randomly provide different levels of subsidy (1/3, 2/3, and full), with follow-up surveys seven months and three years after the initial intervention. We find that a one-time subsidy promotes and sustains insurance enrollment for all treatment groups, but long-run health care service utilization increases only for the partial subsidy groups. We find evidence that selection explains this pattern: those who were enrolled due to the subsidy, especially the partial subsidy, are more ill and have greater health care utilization. Key words: health insurance; sustainability; selection; randomized experiments JEL code: I1, O12 Contact the corresponding author, Hyuncheol Bryant Kim, at
[email protected]; Asuming: University of Ghana Business School; Kim: Department of Policy Analysis and Management, Cornell University; Sim: Department of Applied Economics and Management, Cornell University. We thank Ama Baafra Abeberese, Douglas Almond, Diane Alexander, Jim Berry, John Cawley, Esteban Mendez Chacon, Pierre-Andre Chiappori, Giacomo De Giorgi, Supreet Kaur, Robert Kaestner, Don Kenkel, Daeho Kim, Michael Kremer, Wojciech Kopczuk, Leigh Linden, Corrine Low, Doug Miller, Sangyoon Park, Seollee Park, Cristian Pop-Eleches, Bernard Salanie, and seminar participants at Columbia University, Cornell University, Seoul National University, and the NEUDC. This research was supported by the Cornell Population Center and Social Enterprise Development Foundation, Ghana (SEND-Ghana)." Armand Sim gratefully acknowledges financial support from the Indonesia Education Endowment Fund.