Working as If One's Health Depended Upon it

Study of the implications of declining employer-sponsored health insurance for retirees

In 1996–1999, investigators at the Urban Institute, Washington, investigated the effectiveness of the nation's health insurance system in providing coverage for older Americans using data from the 1992–1994 Health and Retirement study.

Only one-third of persons retiring from public sector jobs can depend on health insurance through their former employers.

The project was part of the Robert Wood Johnson Foundation's (RWJF) national program Changes in Health Care Financing and Organization (HCFO).

Key Findings

  • Researchers reported the following in a Findings Brief:

    • About one-quarter of retirees experienced a change in health insurance coverage after retirement.
    • Workers who expected large premium increases at retirement were significantly less likely to retire early than those who anticipated modest cost increases.
    • Even those workers who received retiree health insurance benefits found the average cost of coverage to increase compared to the cost of coverage while employed.
    • Retirement rates for men with employer-sponsored health insurance, but not retiree health insurance, were substantively lower than for men with retiree health insurance.
    • The effect on early retirement decisions of a proposed program that would allow under-65 retirees to buy into Medicare post-COBRA depends upon premium costs.