Is the Affordable Care Act Affecting Retirement Yet?

38 Pages Posted: 13 Mar 2019

See all articles by Helen Levy

Helen Levy

University of Michigan at Ann Arbor - Institute for Social Research (ISR); National Bureau of Economic Research (NBER)

Thomas C. Buchmueller

University of California - Paul Merage School of Business - Economics/Health Care; University of Michigan, Stephen M. Ross School of Business; National Bureau of Economic Research (NBER)

Sayeh Nikpay

University of Michigan at Ann Arbor

Date Written: September 1, 2018

Abstract

We analyze whether the Affordable Care Act (ACA) has affected labor supply of older Americans using data that span more than four years after the policy’s implementation in 2014. We find no changes in labor supply of older Americans either in response to subsidized marketplace coverage, which became available nationally in 2014, or in response to the expansion of Medicaid eligibility in some states but not others. We analyze multiple dimensions of labor supply — labor force participation; employment; full-time work conditional on employment — as well as several measures of retirement including self-reported retirement and the receipt of retirement income. We fail to find labor supply effects even for subgroups with less than a high school education or those with fair or poor health, who might have been expected to have a greater labor supply response. The lack of a labor supply response stands in contrast to the large gains in coverage observed in 2014. These results suggest that for Americans approaching retirement the Affordable Care Act achieved its primary goal of increasing coverage without the unintended consequence of reducing labor supply.

Keywords: health reform, labor supply, older workers

Suggested Citation

Levy, Helen and Buchmueller, Thomas C. and Nikpay, Sayeh, Is the Affordable Care Act Affecting Retirement Yet? (September 1, 2018). Michigan Retirement Research Center Research Paper WP 2018-393 , Available at SSRN: https://ssrn.com/abstract=3351112 or http://dx.doi.org/10.2139/ssrn.3351112

Helen Levy (Contact Author)

University of Michigan at Ann Arbor - Institute for Social Research (ISR) ( email )

Ann Arbor, MI 48106-1248
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Thomas C. Buchmueller

University of California - Paul Merage School of Business - Economics/Health Care ( email )

Irvine, CA 92697-3125
United States

HOME PAGE: http://web.gsm.uci.edu/~tbuchmu/

University of Michigan, Stephen M. Ross School of Business ( email )

701 Tappan Street
Ann Arbor, MI MI 48109
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Sayeh Nikpay

University of Michigan at Ann Arbor ( email )

500 S. State Street
Ann Arbor, MI 48109
United States

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