Like other countries seeking a progressive path to universalism, Peru has attempted to reduce inequalities in access to health care by granting the poor entitlement to tax-financed basic care without charge. We identify the impact of this policy by comparing the target population's change in health care utilization with that of poor adults already covered through employment-based insurance. There are positive effects on receipt of ambulatory care and medication that are largest among the elderly and the poorest. The probability of getting formal health care when sick is increased by almost two fifths, but the likelihood of being unable to afford treatment is reduced by more than a quarter. Consistent with the shallow coverage offered, there is no impact on use of inpatient care. Neither is there any effect on average out-of-pocket health care expenditure, but medical spending is reduced by up to 25% in the top quarter of the distribution.

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Keywords Health care, Health financing, Health insurance, Peru, Universal coverage
JEL Publicly Provided Private Goods (jel H42), Government Expenditures and Health (jel H51), Government Policy; Regulation; Public Health (jel I18)
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Journal Health Economics
Grant This work was funded by the European Commission 7th Framework Programme; grant id fp7/331815 - Financial Protection against Health Risks - Evidence from an Emerging Country with Universal Coverage and Methodological Considerations (HEALTHEVENT)
Neelsen, S, & O'Donnell, O.A. (2017). Progressive universalism? The impact of targeted coverage on health care access and expenditures in Peru. Health Economics. doi:10.1002/hec.3492