While the debate on universal healthcare coverage (UHC) often focuses on policy prescription and technical issues, the expansion of access to healthcare in developing countries is an eminently political process. This article analyzes the historical background of the adoption of UHC in Indonesia to articulate two intertwined arguments. First, in decentralized young democracies such as Indonesia, local government can play an important role in health policy by experimenting with innovative health insurance schemes. Although such activism may widen subnational inequalities, it can also contribute to the adoption of UHC by increasing the salience of health reform and by allowing policy learning. Second, institutional developments such as decentralization and the introduction of local direct elections can have a substantial impact on incentives for political elites to provide broad-based social services. This article discusses the relevance of these findings for the comparative literature on UHC and social policy in low and middle-income countries.