Using a unique longitudinal dataset from a randomized experiment, we tested whether experimentally introduced higher insurance coverage improved health outcomes and reduced costs of care. Our estimates show that a delay of more than two days before admission is associated with 4.2% higher likelihood of wasting and an 11.2% higher likelihood of positive CRP levels upon discharge. Costs of hospitalization also increase by about 1.9 % of average total costs with delay of more than two days. We find that reducing out-of-pocket payments through higher insurance coverage would result in about 5 more children in 100 going to hospitals less than three days after the onset of symptoms. The reductions were significant and could therefore translate into improved health status and reduced costs in general.
There are only a few rigorous studies that have analyzed the effects of insurance on access to and utilization of care for either adults or children, or the effects of insurance on health outcomes whether measured by specific health conditions or by more general measures of morbidity and mortality.1
Studies focused on children, however, have largely come from quasi experimental settings without a control group (i.e., special insurance programs for children,12,21
expansion of Medicare and Medicaid and other private insurance,6,13-14,22
and more recently, the implementation of various State Children's Health Insurance Programs in the United States.9-11, 23-24
). The unique experimental nature of our dataset allowed us to more rigorously assess the impact of a randomized insurance intervention on a large number of children in a developing country setting where the financial burden of care is high.
Prior studies found insurance coverage improves self-reported perceived health status and reduce activity limitations in children.12,14
We differ from these studies in two aspects. Firstly, we use health status measures that are based on objective biologic and anthropometric measures that are less prone to subjective differences in health perceptions over time. Secondly, we are able to investigate specific mechanisms through which insurance affects outcomes. We find that insurance coverage affects outcomes by influencing the characteristics of utilization, in particular delay in utilization.
Studies that have assessed the cost implications of providing insurance coverage have focused on the increases brought about by moral hazard in the form of increased utilization of care.25
Other studies support the finding that insurance may reduce costs of care only by implication, i.e., that costs can be mitigated by more appropriate utilization, for instance by the utilization of ambulatory care vs. emergency department utilization,10,26
and by utilizing a usual source of care or primary care.11,14
We substantiate these findings by directly estimating differences in total charges owing to delays in utilization of hospital care and showing that insurance coverage can reduce the proportions of children with delayed hospital admission.
Our finding that insurance coverage improves access by reducing delays in health seeking is consistent with other studies that show reductions in the proportions of children that delayed care after enrolling in children's health insurance programs. These studies have reported changes in utilization at both the national9
and state levels.10-12
They also point to the importance in the continuity in insurance coverage, which in our population was accounted for by looking at access across the three year study period.13
Our findings extend these studies in that our measure of delay is associated with hospitalization, rather than ambulatory visits as is typically used. Among the advantages, we expect the impact to be higher on costs and health status and recall bias to be less because we obtained data from the parent or guardian at the point of discharge.
Controlling for diagnosis and services received by child patients, we found those who were admitted more than two days after the onset of symptoms are discharged with worse health status, which is consistent with the literature.27-29
Delays in utilization likely result in children being brought to facilities at later stages of diseases, requiring more intensive treatment. From a family perspective, a delay in utilization inflates the resource requirements related to an illness episode, as more medical interventions and household resources outside of the hospital setting are needed to restore the child to full health. This intuition is supported by our finding that reductions in the number of days from the onset of symptoms to the hospitalization reduce total charges, especially for those with shorter lengths of stay. Because the length of stay of the patient is one of our indicators for illness severity, the effects of delay on charges will be felt more on less ill patients.
Our study has some limitations. We did not have the data to link the introduction of insurance, which clearly decreased care delays, to longer term improvements in health status although we infer this from the association of delays and poor health outcomes at baseline. We also did not have anthropometric measures upon admission that would allow us to definitively rule out wasting as a pre-existing condition; however we were able to control for expected predictors of wasting: parental socioeconomic status and insurance. We cannot distinguish how much of the delay is due to delay in health seeking versus delay in recognizing serious illness by either the parent or the providers. Similarly, we are unable to determine how quality of care at intake or the route of admission impacts the delay. It is possible that some providers systematically fail to recognize whether the condition requires hospitalization, albeit this would be primarily a concern in borderline cases. We further note that due to the unavailability of some supplies and medicines in primary care facilities, some patients are referred to the district hospitals not because of their illness but because more supplies are available at the hospital than the clinic. If this were the case, this would partly explain the reductions in costs observed for reducing delays in admissions for relatively shorter lengths of stay or less severe illnesses.
Lastly, further studies would help establish causal links between delays and adverse outcomes taking into account poor nutritional status, an important co-factor in illness in developing countries. Benefits in terms of health outcomes should also be placed in relation to costs of interventional changes, which we have begun to explore in a forthcoming publication.30