Objectives: I analyze the effect of coverage by health insurance on the use of alternative medicine such as folk healers and homeopaths, in particular if it complements or substitutes conventional services.
Methods: Panel data from the Mexican Health and Aging Study (MHAS) is used to estimate bivariate probit models in order to explain the use of alternative medicine while allowing the determinant of interest, access to health insurance, to be an endogenous factor.
Results: The findings indicate that households with insurance coverage less often use alternative medicine, and that the effect is much stronger among poor than among rich households.
Conclusions: Poor households substitute away from traditional medicine towards conventional medicine.
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