Lorenzo Casaburi

Title: Copayments and the Value of Health Insurance: Experimental Evidence from Uganda

Abstract: How do copayments affect the benefits and costs of health insurance in low-income settings? We study this question in a field experiment in rural Uganda that varies copayments for hospital-based outpatient insurance. Insurance substantially increases the use of high-quality hospital care, improves health, and reduces reliance on costly coping strategies. Lower copayments generate larger increases in utilization, yet health and financial-protection gains are similar across copayment levels. Net benefits derived from treatment effects on health outcomes and insurer costs favor higher copayments. At the same time, households place substantially higher value on low-copayment insurance, underlining that optimal copayment design depends on jointly understanding treatment effects, insurer costs, and household demand.