Objective To assess the differential impact of a copayment exemption compared to a cash incentive on increasing skilled birth attendance (i.e., birth attended by a skilled health worker) in Nepal. Data Sources/Study Setting This study used data on 8,785 children born between July 2005 and December 2008, obtained from the nationally representative Demographic and Health Surveys, 2006 and 2011. Study Design Twenty‐five districts received both the policy interventions, and the remaining 50 control districts received only the cash incentive. We employed a difference‐in‐differences model to compare children born in districts with both interventions to those in districts with conditional cash transfers only. Average marginal effects of the difference‐in‐difference coefficient on skilled birth attendance measures are estimated. Principal Findings Skilled birth attendance in districts with both interventions was no higher on average than in districts with only the cash incentive. In areas with adequate road networks, however, significantly higher skilled birth attendance was observed in districts with both interventions compared to those with only the cash incentive. Conclusions The added incentive of the user‐fee exemption did not significantly increase skilled birth attendance relative to the presence of the cash incentive. User‐fee exemptions may not be effective in areas with inadequate road infrastructure.