The Role of Retiree Health Insurance in the Employment Behavior of Older Men
AbstractWe model the employment and medical care decisions of older men who face health risk. The budget constraint incorporates detailed characteristics of health insurance as well as Social Security and private pensions. A man whose health insurance is tied to continued employment with his current employer faces the risk of large medical expenditures in the event of an adverse health shock if he retires before becoming eligible for Medicare at age 65. A man whose employer provides retiree health insurance or who has access to other health insurance not tied to his employment decision (e.g., from his wife) can retire before age 65 without consequences for his health insurance coverage. We use data from the Health and Retirement Survey to estimate the parameters of the model using structural methods. Simulations based on the estimates imply that changes in health insurance, including access and restrictions to retiree health insurance and Medicare have a modest impact on employment behavior among older males.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 10100.
Date of creation: Nov 2003
Date of revision:
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Other versions of this item:
- David M. Blau & Donna B. Gilleskie, 2008. "The Role Of Retiree Health Insurance In The Employment Behavior Of Older Men," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 49(2), pages 475-514, 05.
- J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
- I1 - Health, Education, and Welfare - - Health
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-11-30 (All new papers)
- NEP-EDU-2003-11-30 (Education)
- NEP-IAS-2003-11-30 (Insurance Economics)
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