A prescription for more retirement income security: retiree health insurance coverage in an era of declining access to employer-sponsored insurance.

As health care costs have been rising, especially for prescription drugs, employers have curtailed access to employer-sponsored retiree health insurance, especially for future retirees. This paper studies the question whether declining access has already translated into measurable loss of coverage for retirees. Based on data from the Current Population Survey and the Medical Expenditures Panel Survey, we find that retirees have lost health insurance and prescription drug coverage since 1996. The declines are especially pronounced for men before age 65 and for all Medicare-eligible retirees between the ages of 65 and 74. Our results also suggest that coverage will decline in the future.