Retiring Early? You Should Probably Wait for a Health Reform Verdict

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For our older UDH Supporters out there:

When readers ask how possible changes to the health care law will affect their lives, I have one piece of concrete advice: If you’re thinking about retiring early, wait. Most of our readers agree.

My colleague Austin Frakt wrote an article last week about the role the Affordable Care Act has played for early retirees and other people interested in embarking on lives and careers untethered to full-time employment. Obamacare’s health insurance markets have their shortcomings, but they do guarantee that people can buy comprehensive coverage for themselves and their families, and can qualify for tax assistance if their income is below a certain threshold.

It’s possible that Republican reforms will leave those people similarly protected. But older people are likely to struggle the most in a less regulated insurance system. Their coverage is likely to be more expensive and may cover fewer of the services they need. Final details are probably worth knowing before making a major life change.

Before Obamacare, there was compelling evidence that people were reluctant to retire, switch jobs, cut back on hours or start a new business because they were worried about health insurance. (Mr. Frakt’s article summarizes some of the biggest studies. My favorite: Researchers saw a spike of entrepreneurship among people the month after they turned 65 and qualified for Medicare.)

Experts, including the economists at the Congressional Budget Office, expected that Obamacare would ease those frictions, called “job lock” by experts. There is little good research on how many people have changed their work lives because of the health law’s guarantees, but Mr. Frakt’s article prompted a flood of comments from Times readers who had either given up their corporate insurance or were hoping to do so soon.

You can read the comments at the New York Times.

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