Health Insurance and Health-Seeking Behaviour: The Distributional Effects of Public Health Insurance in Nepal

Public health insurance is one of the largest fiscal interventions in low- and middle-income countries, but who actually benefits varies sharply across settings. This paper provides the first causal evaluation of Nepal’s National Health Insurance Programme (NHIP), a voluntary household-level scheme rolled out in stages across all 77 districts between 2016 and 2022. Combining a novel district-quarter panel of all health-facility visits with individual-level registration and claims records, I estimate that NHIP eligibility raises total health-facility visits by 14 percent, with similar gains across outpatient, emergency, and diagnostic margins. Effects emerge gradually and remain at their peak level once reached. The gains are unequally distributed: utilisation rises only in low-poverty districts, while high-poverty districts show no significant effect. Evidence from a 2019 facility-reassignment reform points to a supply-side explanation: in poor districts, the network of empanelled facilities is too sparse for coverage to translate into care.