Demand for voluntary health insurance by the poor in developing countries: Evidence from rural Ghana

In recent years the number of formal risk-sharing schemes for health care services in Ghana has risen rapidly. At present about 42 out of 110 districts are operating some form of formal community-based health insurance, which are voluntary and to a greater extent integrated to health care facilities. The success of these schemes depend largely on the extent to which they directly or indirectly lessen the financial burden of people who have suffered most since the inception of economic reforms in the health sector. The paper looked at the social inclusion aspects of the schemes by studying demand for the two oldest schemes by the poor and exploring design features that could enhance better coverage and improve financial protection for health care services. The results from this study show that the schemes perform quite well in terms of paying hospitalisation bills for beneficiaries. However the findings portray a remarkable exclusion of the poorest of the poor, even from other forms of risk-sharing arrangements in the informal sector. Apart from poverty, the analysis also reveals that high-risk households are less likely to participate fully in the insurance schemes. Among other suggestions, the study recommends that the schemes should be redesigned to benefit rural and poor households more than they do now. JEL Classification: I1; I3