The Effects of Retiree Health Insurance Plan Characteristics on Retirees' Choice and Employers' Costs
To moderate the rate of growth of retiree health insurance costs, employers can modify plans and move retirees into less expensive plans. We examine policy modifications implemented by the North Carolina State Health Plan. We investigate whether incentives produce the desired plan elections and whether these changes, along with cost shifting, produce the expected reductions in cost growth. Using individual-level administrative data, along with aggregated data on expenditures for retirees, we estimate the effects of the introduction and subsequent repeal of a Comprehensive Wellness Initiative for non-Medicare eligible retirees, as well as increases in coinsurance and copayments and the introduction of a premium for all retirees. Over a third of non-Medicare retirees shifted into the least generous plan between June 2009 and December 2012. The level effects on annual costs and unfunded accrued liabilities were relatively modest, but growth rates were diminished. Increases in the retiree premiums reduced projected costs.
|Date of creation:||Oct 2013|
|Date of revision:|
|Publication status:||published as The Effects of Retiree Health Insurance Plan Characteristics on Retirees' Choice and Employers' Costs , Robert Clark, Melinda Morrill, David Vanderweide. in State and Local Health Plans for Active and Retired Public Employees , Clark and Newhouse. 2014|
|Note:||HE LS PE|
|Contact details of provider:|| Postal: |
Web page: http://www.nber.org
More information through EDIRC
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.:
- Clark, Robert L. & Morrill, Melinda Sandler, 2011. "The funding status of retiree health plans in the public sector," Journal of Pension Economics and Finance, Cambridge University Press, vol. 10(02), pages 291-314, April.
- Christina Robinson & Robert Clark, 2010. "Retiree Health Insurance and Disengagement from a Career Job," Journal of Labor Research, Springer, vol. 31(3), pages 247-262, September.
- David M. Cutler & Sarah Reber, 1996.
"Paying for Health Insurance: The Tradeoff between Competition and Adverse Selection,"
NBER Working Papers
5796, National Bureau of Economic Research, Inc.
- David M. Cutler & Sarah J. Reber, 1998. "Paying For Health Insurance: The Trade-Off Between Competition And Adverse Selection," The Quarterly Journal of Economics, MIT Press, vol. 113(2), pages 433-466, May.
- Strombom, Bruce A. & Buchmueller, Thomas C. & Feldstein, Paul J., 2002. "Switching costs, price sensitivity and health plan choice," Journal of Health Economics, Elsevier, vol. 21(1), pages 89-116, January.
- John B. Shoven & Sita Slavov, 2013. "The Role of Retiree Health Insurance in the Early Retirement of Public Sector Employees," NBER Working Papers 19563, National Bureau of Economic Research, Inc.
- Maria D. Fitzpatrick, 2013.
"Retiree Health Insurance for Public School Employees: Does it Affect Retirement?,"
CESifo Working Paper Series
4415, CESifo Group Munich.
- Fitzpatrick, Maria D., 2014. "Retiree health insurance for public school employees: Does it affect retirement?," Journal of Health Economics, Elsevier, vol. 38(C), pages 88-98.
- Maria D. Fitzpatrick, 2013. "Retiree Health Insurance for Public School Employees: Does it Affect Retirement?," NBER Working Papers 19524, National Bureau of Economic Research, Inc.
- Cutler, David & Lincoln, Bryan & Zeckhauser, Richard, 2010.
"Selection stories: Understanding movement across health plans,"
Journal of Health Economics,
Elsevier, vol. 29(6), pages 821-838, December.
- David M. Cutler & Bryan Lincoln & Richard J. Zeckhauser, 2009. "Selection Stories: Understanding Movement Across Health Plans," NBER Working Papers 15164, National Bureau of Economic Research, Inc.
- Zeckhauser, Richard Jay & Cutler, David M. & Lincoln, Bryan, 2009. "Selection Stories: Understanding Movement Across Health Plans," Scholarly Articles 4449102, Harvard Kennedy School of Government.
- Cutler, David & Lincoln, Bryan & Zeckhauser, Richard, 2009. "Selection Stories: Understanding Movement across Health Plans," Working Paper Series rwp09-022, Harvard University, John F. Kennedy School of Government.
- Rothschild, Michael & Stiglitz, Joseph E, 1976. "Equilibrium in Competitive Insurance Markets: An Essay on the Economics of Imperfect Information," The Quarterly Journal of Economics, MIT Press, vol. 90(4), pages 630-49, November.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:19566. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.