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How Important Is Medicare Eligibility in the Timing of Retirement?

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Author Info

  • Norma B. Coe
  • Mashfiqur R. Khan
  • Matthew S. Rutledge

Abstract

Eligibility for Medicare at age 65 is widely viewed as an important factor in retirement decisions. However, it has been difficult to quantify the influence of Medicare because eligibility for Medicare came at the same age as Social Security’s Full Retirement Age (FRA). The recent rise in the FRA, along with other changes, has decoupled the age-related incentives in the two programs, making it easier to estimate the effect of Medicare eligibility on the timing of retirement. This brief, based on a recent study, provides such estimates of the importance of Medicare on retirement decisions. The discussion proceeds as follows. The first section discusses the relationship between Medicare eligibility and the timing of retirement. The second section describes the metric used for assessing the timing of retirement and the effect of Medicare eligibility. The third section reports the findings. The fourth section concludes that Medicare eligibility is a significant factor in the retirement decision, but that changes in the availability of health insurance for retirees could alter its importance going forward.

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File URL: http://crr.bc.edu/briefs/how-important-is-medicare-eligibility-in-the-timing-of-retirement/
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Bibliographic Info

Paper provided by Center for Retirement Research in its series Issues in Brief with number ib2013-7.

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Length: 6 pages
Date of creation: May 2013
Date of revision:
Handle: RePEc:crr:issbrf:ib2013-7

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