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Abstract

This paper looks at the effect of road access on the utilization of public health insurance in Karnataka, India. Although public health insurance for low-income households was introduced in 2008, insurance utilization and claims submissions remained lower than projected even five years later. The vast majority of private hospitals are located in urban areas, including small towns, making transportation access an important determinant of health insurance utilization. This paper measures the effect of physical access to hospitals, particularly the proximity to a major new highway, on beneficiaries' utilization of the health insurance. This paper uses the construction of a section of the Golden Quadrilateral in Karnataka to evaluate the role of road access on the number of hospitalizations claimed by beneficiaries in a given sub-district. Because the highway connects historically significant cities and was completed prior to the announcement of the insurance scheme, a straight-line approximation to the highway is a suitable instrument for the distance to the highway in a sub-district. Although some recent work has looked at the effect of last-mile road building on education, the evaluation of major highway projects has traditionally focused on macroeconomic outcomes like aggregate productivity and growth. This paper makes a contribution to a small but growing literature on healthcare utilization and access in developing countries, as well as to the infrastructure development literature by considering a unique outcome like hospital access.

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