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Health insurance reform and retirement: Evidence from the Affordable Care Act

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  • Kevin Wood

Abstract

The Affordable Care Act (ACA) has provided millions of Americans with medical insurance but may have led to an increase in retirement among older individuals who are utilizing the newly available coverage options as a substitute for employer‐provided insurance. Using data from the American Community Survey from 2009–2016, this hypothesis is tested by estimating the effect of the premium subsidies and Medicaid expansions of the ACA on retirement transitions for the non‐Medicare eligible cohort of older Americans aged 55–64. Research results indicate a 2% and 8% decrease in labor force participation resulting from the premium subsidies and Medicaid expansions, respectively. Slightly larger estimates are found among a subgroup of adult couples. The study also finds suggestive evidence of crowd‐out of employer‐sponsored insurance by subsidized marketplace plans but finds no such effects from the Medicaid expansions.

Suggested Citation

  • Kevin Wood, 2019. "Health insurance reform and retirement: Evidence from the Affordable Care Act," Health Economics, John Wiley & Sons, Ltd., vol. 28(12), pages 1462-1475, December.
  • Handle: RePEc:wly:hlthec:v:28:y:2019:i:12:p:1462-1475
    DOI: 10.1002/hec.3959
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    References listed on IDEAS

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    Cited by:

    1. Mark Duggan & Gopi Shah Goda & Gina Li, 2021. "The Effects of the Affordable Care Act on the Near Elderly: Evidence for Health Insurance Coverage and Labor Market Outcomes," Tax Policy and the Economy, University of Chicago Press, vol. 35(1), pages 179-223.
    2. Aslim, Erkmen Giray, 2022. "Public health insurance and employment transitions," Labour Economics, Elsevier, vol. 75(C).

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