The Study of Optimal Financial Design of Universal Coverage of Health Insurance Through CGE Model Analysis in The Presence of Informality in Indonesia: Services, Membership, Premium, and Willingness to Pay

Indonesia has recently experienced a proliferation of health care financing design, implemented and operated by government using the Universal Coverage of Health Insurance (BPJS) target. Ourpreliminary findings show that BPJS health schemes have ambitious target that may impose service availability and fiscal burden. Therefore, we examine the willingness to pay issues empirically to Join BPJS Health by conducting a three districts field experiment selected based on Socio-economic condition within Indonesia’s Conditional Premium Health program. Targeting aspect in the program is conducted by automatically enrolling candidates who willing to pay on the level of treatment class. We identify level ofreasonable premium, what is the sustainable payment and incentive to attract people to join BPJS health. Fromfield survey, we find that most people are more likely to pay 3rd premium class though 1st and 2nd class are still affordable. The analysis also consistently shows that, from varying perspectives, Indonesia’s tariff premium on BPJS Health is too expensive for informal sectors and there is unfair premium over regions due to the diversity of socio economic level. Although no problem on sustainability of payment, there is a need to design incentive to keep BPJS Health sustain. In short, extraordinary efforts such as fiscal support and strong commitment are needed to achieve BPJS Health, but the more effective benefit schemes joining BPJS relied on promoting health insurance literacy.

(Teguh Dartanto, LPEM FEUI, August18th , 2014)

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