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Health insurance and retirement of married couples

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Author Info
Donna B. Gilleskie (University of North Carolina at Chapel Hill, NC, USA)
David M. Blau (University of North Carolina at Chapel Hill, NC, USA)

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Abstract

Most health insurance in the USA is provided by employers until eligibility for public health insurance (Medicare) begins at age 65. Retiring before 65 exposes workers who lack retiree health insurance coverage to the risk of catastrophic medical expenditure. We solve and estimate a dynamic model of the employment behavior of older married couples that includes risky medical expenditure and health insurance. Parameter estimates imply that the risk-reducing feature of health insurance can account for about half of the observed association between retiree health insurance and employment for married men, but can account for only one tenth of the much larger observed association for married women. Policy simulations imply very small effects on employment of changing the age of eligibility for Medicare from 65 to 67. Copyright © 2006 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/jae.921
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File URL: http://qed.econ.queensu.ca:80/jae/2006-v21.7/
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Publisher Info
Article provided by John Wiley & Sons, Ltd. in its journal Journal of Applied Econometrics.

Volume (Year): 21 (2006)
Issue (Month): 7 ()
Pages: 935-953
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Handle: RePEc:jae:japmet:v:21:y:2006:i:7:p:935-953

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Starr-McCluer, Martha, 1996. "Health Insurance and Precautionary Savings," American Economic Review, American Economic Association, vol. 86(1), pages 285-95, March.
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  2. Alan L. Gustman & Thomas L. Steinmeier, 1994. "Employer-provided health insurance and retirement behavior," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 48(1), pages 124-140, October.
  3. Blau, David M, 1998. "Labor Force Dynamics of Older Married Couples," Journal of Labor Economics, University of Chicago Press, vol. 16(3), pages 595-629, July. [Downloadable!] (restricted)
  4. Hurd, Michael D, 1989. "Mortality Risk and Bequests," Econometrica, Econometric Society, vol. 57(4), pages 779-813, July. [Downloadable!] (restricted)
  5. Eric French & John Bailey Jones, 2004. "The Effects Of Health Insurance And Self-Insurance On Retirement Behavior," Working Papers, Center for Retirement Research at Boston College 2004-12, Center for Retirement Research. [Downloadable!]
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  6. Richard Blundell & Pierre-Andre Chiappori & Thierry Magnac & Costas Meghir, 2002. "Collective Labor Supply: Heterogeneity and Nonparticipation," Research Unit Working Papers 0210, Laboratoire d'Economie Appliquee, INRA. [Downloadable!]
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