The social consequences health policy mandates may have on elderly worker labor force participation

This investigation seeks to clarify whether health policy mandates associated with national health care reform are unintentionally changing the way elderly Americans participate in the labor market. Retirement researchers suggest that the Consolidated Omnibus Reconciliation Act of 1985 (COBRA-85) may have caused elderly workers to retire early by bridging their employer-provided health insurance coverage (EPHI) before they became eligible for Medicare at age 65. Additional research on labor supply trends has also noted a pronounced shift in elderly worker participation, with more workers gradually decreasing their participation prior to retiring. The 1996 Health Insurance Portability and Accountability Act mandates the portability of prior health insurance coverage, and this added protection may have led more elderly workers to opt for COBRA-85 continuation coverage as an option during early retirement. This longitudinal assessment, based on data from the Health and Retirement Survey to systematically evaluate how the combined enactment of these mandates influenced elderly worker retirement attitudes and intentions, suggests that continued use of the mandate approach has influenced the perception of behavioral control for elderly workers with EPHI. Such influence is particularly clear for individuals who expressed a positive state of health. These results both support and expand the findings associated with earlier research concerning this subject, and provide new evidence behind explaining the impact that mandate policies can have on worker attitudes and intentions, offering a new perspective behind explaining the observed departure from traditional retirement behaviors reported in the literature. In addition, these results expose the increased liability behind expanding this mandate approach for employers who offer health benefits, since these results strongly suggest that elderly workers are leveraging these benefits while decreasing their contribution to these companies.