The implications of declining retiree health insurance
- Collection:
- Health Policy and Services Research
- Series Title(s):
- Center for Retirement Research working paper
- Contributor(s):
- Monk, Courtney. Munnell, Alicia H. Center for Retirement Research at Boston College.
- Publication:
- Chestnut Hill, MA : Center for Retirement Research at Boston College, c2009
- Language(s):
- English
- Format:
- Text
- Subject(s):
- Health Benefit Plans, Employee -- trends Insurance Coverage -- trends Insurance, Health -- trends Retirement -- statistics & numerical data Age Factors Choice Behavior Eligibility Determination Employment Financing, Personal Forecasting Health Benefit Plans, Employee -- economics Health Benefit Plans, Employee -- statistics & numerical data Health Surveys Insurance Benefits Insurance Coverage -- economics Insurance Coverage -- statistics & numerical data Insurance, Health -- economics Insurance, Health -- statistics & numerical data Medicaid Medically Uninsured Middle Aged Humans United States
- Genre(s):
- Technical Report
- Abstract:
- A large number of retirees have employer-sponsored retiree health insurance (RHI). While RHI is a common source of supplemental coverage for Medicare beneficiaries, it is also the only affordable source of health insurance for many retirees under age 65 who have no access to Medicare. However, employers are scaling back their RHI benefits in response to rising health costs and changes in accounting rules, by either eliminating benefits which shifts costs to retirees, or tightening vesting requirements. Using data from the Health and Retirement Study, this paper examines the potential consequences of eliminating RHI for both pre-Medicare and Medicare-eligible retirees. For younger retirees the likely primary response is to work longer, and we find that number of workers age 55 to 64 would increase by 7 percent, as some of those who have their access to RHI eliminated would work rather than retire. Of those who still choose to retire, most lack any employer-sponsored health insurance option and would need to find an alternative source of coverage or go uninsured. For Medicare beneficiaries over 65, we estimate that about three quarters would replace RHI with another form of supplemental coverage. This shift would slightly reduce total spending and utilization for individuals who choose basic Medicare or a Medicare HMO as opposed to a Medigap plan, but health outcomes would probably be unaffected no matter which supplemental option is chosen. In short, a full elimination of RHI would primarily impact early retirees who must face the cost of much more expensive insurance or of financing illness without insurance. Policymakers may want to consider encouraging insurers to step in to provide more affordable plans for these early pre-Medicare retirees.
- Copyright:
- Reproduced with permission of the copyright holder. Further use of the material is subject to CC BY license. (More information)
- Extent:
- 36 p.
- Illustrations:
- Illustrations
- NLM Unique ID:
- 101513602 (See catalog record)
- Permanent Link:
- http://resource.nlm.nih.gov/101513602