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Government health insurance for people below poverty line in India: quasi-experimental evaluation of insurance and health outcomes

BMJ 2014; 349 doi: (Published 25 September 2014) Cite this as: BMJ 2014;349:g5114
  1. Neeraj Sood, associate professor123,
  2. Eran Bendavid, assistant professor45,
  3. Arnab Mukherji, associate professor6,
  4. Zachary Wagner, PhD student7,
  5. Somil Nagpal, senior health specialist8,
  6. Patrick Mullen, senior health specialist8
  1. 1Department of Pharmaceutical Economics and Policy, School of Pharmacy, University of Southern California, Los Angeles, CA, USA
  2. 2Leonard D Schaeffer Center for Health Policy and Economics, University of Southern California, Los Angeles, CA, USA
  3. 3National Bureau of Economic Research, Cambridge, MA, USA
  4. 4Division of General Medical Disciplines, Stanford University, Stanford, CA, USA
  5. 5Center for Health Policy and the Center for Primary Care and Outcomes Research, Stanford University, Stanford, CA, USA
  6. 6Center for Public Policy, Indian Institute of Management Bangalore, Bangalore, India
  7. 7School of Public Health, UC Berkeley, Berkeley, CA, USA
  8. 8World Bank, New Delhi, India
  1. Correspondence to: N Sood, Leonard D Schaeffer Center for Health Policy and Economics, University of Southern California, Los Angeles, CA, USA nsood{at}
  • Accepted 24 July 2014


Objectives To evaluate the effects of a government insurance program covering tertiary care for people below the poverty line in Karnataka, India, on out-of-pocket expenditures, hospital use, and mortality.

Design Geographic regression discontinuity study.

Setting 572 villages in Karnataka, India.

Participants 31 476 households (22 796 below poverty line and 8680 above poverty line) in 300 villages where the scheme was implemented and 28 633 households (21 767 below poverty line and 6866 above poverty line) in 272 neighboring matched villages ineligible for the scheme.

Intervention A government insurance program (Vajpayee Arogyashree scheme) that provided free tertiary care to households below the poverty line in about half of villages in Karnataka from February 2010 to August 2012.

Main outcome measure Out-of-pocket expenditures, hospital use, and mortality.

Results Among households below the poverty line, the mortality rate from conditions potentially responsive to services covered by the scheme (mostly cardiac conditions and cancer) was 0.32% in households eligible for the scheme compared with 0.90% among ineligible households just south of the eligibility border (difference of 0.58 percentage points, 95% confidence interval 0.40 to 0.75; P<0.001). We found no difference in mortality rates for households above the poverty line (households above the poverty line were not eligible for the scheme), with a mortality rate from conditions covered by the scheme of 0.56% in eligible villages compared with 0.55% in ineligible villages (difference of 0.01 percentage points, −0.03 to 0.03; P=0.95). Eligible households had significantly reduced out-of-pocket health expenditures for admissions to hospitals with tertiary care facilities likely to be covered by the scheme (64% reduction, 35% to 97%; P<0.001). There was no significant increase in use of covered services, although the point estimate of a 44.2% increase approached significance (−5.1% to 90.5%; P=0.059). Both reductions in out-of-pocket expenditures and potential increases in use might have contributed to the observed reductions in mortality.

Conclusions Insuring poor households for efficacious but costly and underused health services significantly improves population health in India.


  • We presented preliminary findings from this research to World Bank, Government of Karnataka, and academic healthcare researchers.

  • Contributors: NS led all aspects of the study. EB and ZW co-led all analysis and preparation of the manuscript. AM co-led data collection and helped with data analysis. SN and PM helped conceive the study, coordinated with the government, obtained research funding, and provided critical comments on research design and results. NS is guarantor.

  • Funding: This project was funded by the Health Results Innovation Trust Fund at the World Bank. The funding agency played no role in the conduct of this research and the decision to submit this manuscript for publication.

  • Competing interests: All authors have completed the ICMJE uniform disclosure form at and declare: no support from any organization for the submitted work; no financial relationships with any organizations that might have an interest in the submitted work in the previous three years; no other relationships or activities that could appear to have influenced the submitted work.

  • Ethics approval: The study was reviewed and approved by the institutional ethics committee at Indian Institute of Management, Bangalore, India (IRB# IORG0004307).

  • Data sharing: Technical appendix, statistical code, and data used in this study are available from the corresponding author.

  • Transparency declaration: The authors affirm that the manuscript is an honest, accurate, and transparent account of the study was reported and no important aspects of the study have been omitted.

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