Beyond medical care: public health insurance, caloric intake, and labor productivity in rural China

Research on public health insurance (PHI) and human capital has focused on direct pathways through which increased medical utilization improves human health capital. However, a possible indirect pathway may also exist: PHI may expand the budget for nonmedical expenditures, some of which are important human capital inputs. This study uses the New Rural Cooperative Medical Scheme (NRCMS) to examine whether two empirical associations are consistent with a potential indirect pathway: NRCMS participation is associated with higher individual caloric intake, and caloric intake is associated with subsequent labor productivity. Using unbalanced panel data from the 2009 and 2011 waves of the China Health and Nutrition Survey, we examined two hypotheses: NRCMS participation is associated with higher individual caloric intake, and higher caloric intake is associated with higher productivity, as measured by earnings per working day. We used propensity score matching for the first hypothesis and inverse probability weighting regression for the second hypothesis. NRCMS participation was associated with approximately 294 kcal/day higher caloric intake. A caloric difference of this magnitude was associated with 2.97%–3.91% higher labor productivity in rural China in the late 2000s. These findings suggest that nonmedical consumption may be a relevant pathway linking public health insurance to human capital in low-income rural settings. While causal interpretation remains limited, they underscore the importance of examining the broader human capital implications of health insurance beyond health outcomes.