The onset of Medicare eligibility at age 65 leads to sharp changes in the health insurance coverage of the U.S. population. These changes lead to increases in the use of medical services, with a pattern of gains across socioeconomic groups that varies by type of service. While routine doctor visits increase more for groups that previously lacked insurance, hospital admissions for relatively expensive procedures like bypass surgery and joint replacement increase more for previously insured groups that are more likely to have supplementary coverage after 65, reflecting the relative generosity of their combined insurance package under Medicare.One fifth of non-elderly adults in the United States lacked health insurance coverage in 2005. Most of these were from lower-income families, and nearly one-half were African American or Hispanic (DeNavas-Walt, Proctor, and Lee, 2005). Many analysts have argued that unequal insurance coverage contributes to disparities in health care utilization and health outcomes across socioeconomic groups. Even among the insured there are differences in copayments, deductibles, and other features that affect service use. Nevertheless, credible evidence that better insurance causes better health outcomes is limited (Brown et al., 1998; Levy and Meltzer, 2001). Both the supply and demand for insurance depend on health status, confounding observational comparisons between people with different insurance characteristics.In contrast to the heterogeneity among the non-elderly, fewer than one percent of the elderly population are uninsured, and most have fee-for-service Medicare coverage. The transition occurs abruptly at age 65, the threshold for Medicare eligibility. Building on this fact, in this paper we use a regression-discontinuity framework to compare health-related outcomes among people just before and just after 65. Our analysis extends existing research on the effects of the age 65 threshold (Lichtenberg, 2002; Dow, 2002; Decker and Rapaport, 2002;Decker, 2002aDecker, , 2002band McWilliams et al., 2003) in two main ways. First, we examine a wider range of outcomes. We use survey data from the National Health Interview Survey (NHIS) to analyze changes in self-reported access to care, and in the number of recent doctor visits and hospital stays. We supplement these data with hospital discharge records from California, Florida, and New York, which allow us to measure changes in hospital admissions for specific conditions NIH-PA Author ManuscriptNIH-PA Author Manuscript NIH-PA Author Manuscript and procedures, and by hospital type. Second, we focus on the differential effects of Medicare eligibility on different subgroups, and use the pattern of inter-group differences to assess whether these impacts arise through changes in insurance coverage, insurance generosity, or other channels. We also quantify the extent to which the onset of Medicare eligibility reduces or increases disparities in use of different types of services.Our main finding is that Medicare eligibility causes a ...

We present the first estimates of the causal effects of SSDI receipt on labor supply that are generalizable to the entire population of program entrants in the present day system. We take advantage of a unique workload management database to match Social Security Disability Insurance (SSDI) applicants to disability examiners, and use natural variation in examiners' allowance rates to estimate the labor supply effects of SSDI. Because applicants are randomly assigned to examiners (conditional on observable characteristics), examiner specific allowance rates can be used to instrument for the allowance decision in a labor supply equation contrasting denied vs. allowed applicants. We find that the labor force participation rate of the marginal entrant would be on average 21 percentage points greater in the absence of SSDI benefit receipt. His or her likelihood of engaging in substantial gainful activity as defined by the SSDI program would be on average 13 percentage points higher, and he or she would earn $1,600 to $2,600 more per year on average in the absence of SSDI benefit receipt. The marginal entrant is likely to have a mental impairment, be young, and have low pre-onset earnings. Importantly, the disincentive effect varies across individuals with impairments of different degrees of unobservable severity, ranging from a low of 10 percentage points for those with more severe impairments to a high of 60 percentage points for entrants with relatively less severe impairments.

This paper analyzes a puzzling aspect of retirement behavior known as “unretirement.” Nearly 50 percent of retirees follow a nontraditional retirement path that involves partial retirement or unretirement, and at least 26 percent of retirees later unretire. I explore two possible explanations: 1) unretirement transitions result from failures in planning or financial shocks; and 2) unretirement transitions are anticipated prior to retirement, reflecting a more complex retirement process. I show that unretirement was anticipated for the vast majority of those returning to work, and is not a result of financial shocks, poor planning or low wealth accumulation.

The health insurance characteristics of the population changes sharply at age 65 as most people become eligible for Medicare. But do these changes matter for health? We address this question using data on over 400,000 hospital admissions for people who are admitted through the emergency room for "non-deferrable" conditions-diagnoses with the same daily admission rates on weekends and weekdays. Among this subset of patients there is no discernible rise in the number of admissions at age 65, suggesting that the severity of illness is similar for patients on either side of the Medicare threshold. The insurance characteristics of the two groups are much different, however, with a large jump at 65 in the fraction who have Medicare as their primary insurer, and a reduction in the fraction with no coverage. These changes are associated with significant increases in hospital list chargers, in the number of procedures performed in hospital, and in the rate that patients are transferred to other care units in the hospital. We estimate a nearly 1 percentage point drop in 7-day mortality for patients at age 65, implying that Medicare eligibility reduces the death rate of this severely ill patient group by 20 percent. The mortality gap persists for at least two years following the initial hospital admission.

Health insurance characteristics shift at age 65 as most people become eligible for Medicare. We measure the impacts of these changes on patients who are admitted to hospitals through emergency departments for conditions with similar admission rates on weekdays and weekends. The age profiles of admissions and comorbidities for these patients are smooth at age 65, suggesting that the severity of illness is similar on either side of the Medicare threshold. In contrast, the number of procedures performed in hospitals and total list charges exhibit small but statistically significant discontinuities, implying that patients over 65 receive more services. We estimate a nearly 1-percentage-point drop in 7-day mortality for patients at age 65, equivalent to a 20% reduction in deaths for this severely ill patient group. The mortality gap persists for at least 9 months after admission.

We present the first causal estimates of the effect of Social Security Disability Insurance benefit receipt on labor supply using all program applicants. We use administrative data to match applications to disability examiners and exploit variation in examiners' allowance rates as an instrument for benefit receipt. We find that among the estimated 23 percent of applicants on the margin of program entry, employment would have been 28 percentage points higher had they not received benefits. The effect is heterogeneous, ranging from no effect for those with more severe impairments to 50 percentage points for entrants with relatively less severe impairments. (JEL H55, J14, J22)

for valuable feedback, as well as participants of the 2014 SIEPR/Sloan Working Longer Conference at Stanford University and the Harvard Labor Economics Seminar for their many helpful comments. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. At least one co-author has disclosed a financial relationship of potential relevance for this research. Further information is available online at http://www.nber.org/papers/w22452.ack NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

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