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  • Define treatment and control groups in DID

    Hi all,

    I have four waves (2006-2008-2010-2012) of a repeated cross-sectional data and I want to examine the effects of changes in coinsurance stipulated in a policy in 2009 (let's call policy A) on health outcomes. The policy A stipulates that pensioners are obligated to pay a coinsurance rate of 5%, social policy beneficiaries pay nothing, and individuals with social health insurance card who do not fit the first two groups shall pay 20% of coinsurance. I want to look at the changes in coinsurance among pensioners only (down from 20% to 5%).

    In addition to policy A, there are two other existing policies that may affect health outcomes. For example, policy B in 2010 stipulates that those aged 80 and older are entitled 100% coverage of healthcare. Similarly, the poor (policy C in 2003) also pays nothing when they use healthcare services. Thus, in order to have the explicit effects of policy A, I exclude those who are entitled policies B and C. The retirement age in my sample is 50 and the years 2006-2008 represent pre-policy and 2010-2012 are post-policy A. I define the treatment and control groups in my DID set up as follows:

    Treatment group: individuals aged 50-79 + pension entitlement + non-poor + having insurance but not a free one + affected by the policy A
    Control group: individuals aged 50-79 + non- pension entitlement + non-poor + having insurance but not a free one + unaffected by the policy A

    I am not sure whether my definitions for the treatment and control groups are correct? an suggestion is highly appreciated.

    Thank you.
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