Impact evaluations assess the degree to which a particular policy, program or policy has affected the well-being of individuals. They can play a tremendous role in making effective policy and necessitate a larger discussion in the context of efforts to improve development effectiveness. On January 15 to 16 2008 the conference “Making Smart Policy: Using Impact Evaluation for Policy Making” was held at the World Bank Headquarters in Washington, D.C. The conference was organized by the Poverty Reduction and Economic Management (PREM), Independent Evaluation Group (IEG), and Development Economics (DEC) networks of the World Bank, with co-sponsorship by DFID and the Government of the Netherlands.
The break-out session on “Health” was held on February 15th, 2008 and was chaired by Charlie Teller. Pascaline Dupas, an Associate Professor of Economics at Dartmouth College, was the first presenter to speak. Pascaline spoke about cost sharing—charging a subsidized, positive price—for a health product, specifically bed nets for malaria prevention. saying that if bed nets are to be subsidized these subsidies must be high enough so that people with constraints can still access it, but low enough that it discourages people that have a low valuation for the goods to taking them. Free distribution is possibly more cost effective than price sharing, she concluded. Dupas spoke about the policy impact of this study, which received good reception from the Kenyan government who find funding for free distribution hard to find, especially in terms of convincing donors. The paper has also had an impact on aids agencies, she said, yet less successful with private foundations. With regards to policy impact, some challenges remain.
Michael Kremer, a Professor of Economics at Harvard University, talked about deworming. He explained that it is an issue that affects 400 million children around the world and causes anemia, it is cheap to treat and the side effects are minor. Since it is considered a normal part of life in many areas, he explained, many people do not seek treatment. The WHO, he said, advocates mass treatment for these reasons. However, Kremer explained this idea is hard to implicate due to competing priorities and in the absence of proof that it produces cognitive effects. He also cited a desire for sustainability, since people often get re-infected, for which some suggest cost sharing or health education. Kremer explained his involvement in a Primary School Deworming Program in rural Kenya, which included a health education and a cost sharing component. Among the results he cited a large increase in school participation, evidence of spillover benefits, and that it was extremely cost effective. Also, it was determined that cost sharing and health education were ineffective, in addition to negative social learning. Kremer discussed the policy implications of these findings and the work to disseminate them. He also discussed the policy impacts of the study, which included a major expansion of the program and the inclusion of deworming into the national education program in Kenya. While there is definitely progress, challenges remain since the issue and while evidence must be accompanied by advocacy in order to be effective.
Adam Wagstaff, a Lead Health Economist in the Development Economics Research Group (DECRG) at the World Bank, delivered the final presentation. Wagstaff spoke about impact evaluations in rural health insurance in China. Wagstaff started by providing a background to the health care intervention, stating that in the 1980’s the cooperative medical scheme in China collapsed and facilities started charging for services. Although prices were set by the government, he said, costs increased rapidly due to the government’s plan to cross subsidize health care by allowing providers to profit on high technology care but losses on basic care. Since providers used an unnecessary amount of high technology care, patients also saw a rapid rise in out of pocket payments. Thus the government designed a new insurance scheme for rural areas, Wagstaff explained, in order to reduce out of pocket payments and increase use of basic care. The scheme is heavily subsidized by the Chinese government, he said. There are also a lot of problems, including the low coverage for out patient care. Wagstaff then explained the impact evaluation itself, explaining that the Chinese government was initially unreceptive. Wagstaff explained the methods of the evaluation, citing the succeses and failures of the intervention. Ultimately, he said, it was found that the new health insurance plan produced positive impacts of use of both in and out patient care, yet no reductions in out of pocket payments. Despite this, Wagstaff said there was a positive effect of the evaluation on policy, and that it gave Chinese policy makers a clearer understanding of the new insurance plan. Wagstaff concluded with two lessons: first that expanding insurance coverage does necessarily drive down out of pocket costs, and that the success of the Bank’s impact evaluations made by the Bank can depend on the partner.
The session was concluded by a questions and comments session, where audience members asked about the reasons health education was ineffective in deworming and why the Chinese government was so unhappy about the evaluation’s initial findings, among other things.
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