The Effect of the Affordable Care Act on the Labor Supply, Savings, and Social Security of Older Americans

59 Pages Posted: 3 Feb 2017  

Eric French

Federal Reserve Bank of Chicago; Department of Economics

Hans-Martin von Gaudecker

University of Bonn - Economic Science Area; Netspar; Max Planck Society for the Advancement of the Sciences - Munich Center for the Economics of Aging (MEA)

John Bailey Jones

Federal Reserve Bank of Richmond; University at Albany, SUNY

Date Written: October 1, 2016

Abstract

This paper assesses the effect of the Affordable Care Act (ACA) on the labor supply of Americans ages 50 and older. Using data from the Health and Retirement Study and the Medical Expenditure Panel Survey, we estimate a dynamic programming model of retirement that accounts for both saving and uncertain medical expenses. Importantly, we model the two key channels by which health insurance rates are predicted to change: the Medicaid expansion and the subsidized private exchanges.

Keywords: Affordable Care Act, labor supply, retirement model, insurance rates

Suggested Citation

French, Eric and von Gaudecker, Hans-Martin and Jones, John Bailey, The Effect of the Affordable Care Act on the Labor Supply, Savings, and Social Security of Older Americans (October 1, 2016). Michigan Retirement Research Center Research Paper No. 2016-354. Available at SSRN: https://ssrn.com/abstract=2911074 or http://dx.doi.org/10.2139/ssrn.2911074

Eric French (Contact Author)

Federal Reserve Bank of Chicago ( email )

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Hans-Martin Von Gaudecker

University of Bonn - Economic Science Area ( email )

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John B. Jones

Federal Reserve Bank of Richmond ( email )

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University at Albany, SUNY ( email )

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