Many Planning to Work Longer for Health Benefits

However, this may not be possible for some workers. According to findings from the 2012 Health Confidence Survey (HCS), sponsored by the Employee Benefit Research Institute (EBRI) and Mathew Greenwald and Associates, less than one in five (19%) retirees say they were able to work longer to continue receiving health insurance through their jobs. In addition, 27% of workers reported that they would retire earlier than planned if they were guaranteed access to health insurance. 

The HCS notes that health care expenses are a key component of spending in retirement: In 2009, health care accounted for 18% of expenses for people 85 and older, 15% of expenses for people ages 75 to 84, and 12% of expenses for people ages 65 to 74. Medicare beneficiaries ages 65 and older paid an average of 13% of the cost of their health care services in 2009 (Medicare covered 59%, while private insurance covered 14%).  

Paul Fronstin, director of EBRI’s Health Research and Education program, said the 2010 federal health reform law might change the current labor-market dynamics of older workers. Under the Patient Protection and Affordable Care Act of 2010 (PPACA), retirees (as well as many other Americans) will be able to purchase health insurance directly from health insurance exchanges, and they also stand to benefit from other insurance-market reforms combined with those exchanges, including guaranteed issue, modified community rating, and premium and cost-sharing subsidies for those earning less than 400% of the poverty level, as well as increased health plan choices, he noted.