Health Insurance Coverage Transitions of Older Americans

Health insurance coverage can be a significant factor in determining older individuals' economic and health
security. This report uses data from the first two waves of the Health and Retirement Survey to examine the
health insurance transitions of two groups: those who moved into retirement between 1992 and 1994 and
those who were already retired in both years. For a quarter of full-time workers in 1992 who moved to
retirement, this transition also involved a change in health insurance coverage. The percentage who were
uninsured increased from 7 percent to 13 percent. Although the majority of full-time workers with
own-employer health insurance kept this coverage when they retired, not all did. Fully a third of workers who
became uninsured when they retired between 1992 and 1994 had insurance through an employer while they
were working; 43 percent of retirees who became uninsured had no health insurance while they were working.
Our results indicate a much lower rate of employer group coverage for those already retired in wave 1 (1992).
While insurance coverage for those with employer group insurance (whether through theirown spouse or their
employer) remained quite stable, we observe considerable instability amongthose who retired with nongroup
coverage or without health insurance. Transitions into government coverage are important for this group, as
some completed the two-year waiting period for Medicare eligibility for the disabled and others qualified for
Medicaid. Overall, health insurance coverage was a problem for the most vulnerable persons in this age
group. The rates of uninsurance were much higher for low-income, disabled, and single persons. Many lacked
options for purchasing affordable insurance to tide them over until they were eligible for Medicare at age 65.