The Role of Health Insurance in Joint Retirement among Married Couples

Abstract

Because the near-elderly have high expected medical expenditures, availability of health insurance is an important factor in their retirement decisions. Using Health and Retirement Study data collected in 1992–2002, the authors of this study investigate whether access to employer-provided retiree health insurance enabled dual working couples to time their retirement together—a behavior called “joint retirement.” They find that when wives had employer-provided retiree health insurance, the likelihood of joint retirement more than doubled. The effect of retiree health insurance on overall employment patterns, in contrast, was modest: estimates indicate that a hypothetical change from universal availability of such insurance to its universal unavailability would have increased employment levels by only two percentage points.