“What a Sustained Low-yield Rate Environment Means for Retirement Income Adequacy: Results From the 2013 EBRI Retirement Security Projection Model,®” and “Use of Health Care Services and Access Issues by Type of Health Plan: Findings from the EBRI/MG ..

Low-yields and Retirement: As many retirees and workers have discovered, today’s historically low interest rates are crimping their retirement savings. Now a new study by EBRI quantifies the impact of a sustained low-interest rate environment on America’s retirement readiness. Health Access: Whether it’s a “consumer-driven,” high-deductible, or traditional managed-care health plan, a significant number of people with health insurance report problems with access to health care services, according to new research by EBRI.

What a Sustained Low-yield Rate Environment Means for Retirement Income Adequacy: Results From the 2013 EBRI Retirement Security Projection Model,^®”

Overall, 25–27 percent of Baby Boomers and Gen Xers who would have had adequate retirement income under return assumptions based on historical averages are simulated to end up running short of money in retirement if today’s historically low interest rates are assumed to be a permanent condition, assuming retirement income/wealth covers 100 percent of simulated retirement expense.
A low-yield-rate environment may have an extremely large impact on retirement-income failure rates when viewed in isolation. However, the impact is muted somewhat when included as part of the entire retirement portfolio (e.g., Social Security benefits, possible defined benefit accruals, and net housing equity).
There appears to be a very limited impact of a low-yield-rate environment on retirement income adequacy for those in the lowest- (pre-retirement) income quartile, given the relatively small level of defined contribution and IRA assets and the relatively large contribution of Social Security benefits for this group. However, there is a very significant impact for the top three income quartiles.

Use of Health Care Services and Access Issues by Type of Health Plan: Findings from the EBRI/MGA Consumer Engagement in Health Care Survey

In 2012, 26–40 percent of respondents reported some type of access-to-health-care issue for either themselves or family members. Individuals in consumer-driven health plans (CDHPs) and high-deductible health plans (HDHPs) were more likely than individuals with traditional coverage to report access issues
Individuals in households with less than $50,000 in annual income were more likely than those in households with $50,000 or more in annual income to report access issues.
Very few differences in access issues were found by whether employers contributed to the account, but access issues were found by the level of contribution.
Length of time with the account had an impact on access issues, with 2012 being the first year where it was found that more years with the account were more likely to be associated with access issues.

Figure 3 Figure 1 Boomers included (VanD and Gen erhei Xers. and Copeland, 2008). money, Finally, contribut References However, high eligibility. fell agai er-de . “Kansas Future Retirem . “Retirement Income A n while as educti bet These if to we the w th it b ll een e le is as real acco phen CDHP helpful 2the 01 bond unt 0 omen per enro an (Fi from c d returns deq entage g a llees 2ure ent Income A 0 are 1 uac a 1 4 , taki public-p ev ) y: Alter a are . of nd In en ng pre the assum fa m m native T crolicy ssessment Pro o e tetirement , perce re dici there e pron ne d perspec ntag hto to resh w ounc e be trea e re co o lzero tre mpen ds an no ed jive t ect.” A project of portin hypert statistically wh to perman d the Importanc sation en hav g ension tmov he e ently quantification y they idelay signi ng in the EBRI Educatio would late from and fe e of Future icant d 20 or the the 03 need di avequity f by historic oided fwere erenc Eli various in g terms no he e n an premium ib s al-retu ilit alth longe betw y in d Re hof o care Define useh een r rsearch F additional n taking is assumptions due told assum hd Co e tto the categ w un o ntributio co e d savings groups d a sto nd to ries to n Figure 1 Use of Health Care Services and Access I What a Sustained Low-yield Rate Environment Means for ssues by Type of Impact of Low-Interest-Rate Scenarios on Gen Xers' Impact of Low-Interest-Rate Scenarios on 4 Retirement Plans.” the Milbank Memorial F EBRI Notes, und. July no. 4 (Emplo 16, 2002. yee Benefit Re TMsearch Institute, April 2011): 10–19. as be iin in medicatio real ncmost order re to 6 bond ased percent the years to n likel b returns e in htw a (denoted 200 y of ve e impact ethe n a 4. based 20 50, Amon survey. 1170 of as and on g , a 6 or isustained / ndivi current 20 0 90 in 12 A duals percent the . ccess I five-year figure), ,wh low-yield ssu o probability continu es, th TIPS b ese retur yed Ty returns: nu of to p nmbers e o retirement-in environmen take f Heal an m drop edicat 8 thpercentag Pl bty i an ons come on 10 , 2005–2012 retirem after percentage ad e-poi equacy. moving ent nt decrease income points to a CD adequacy, (just HP, in the there 45 RRR percent was this for no begs those of Buntin, M.B., A .M. Haviland, R. McDevitt, and N. Sood. “Healthcare Spending and Preventive Care in High-Deductible and Retirement Readiness Ratings, by Future Years of TM Retirement Income Adequacy: Results From the 2013 EBRI Health Plan: Findings from the EBRI/MGA Consumer 2009 Additional The September modi 2012 fications Retirement Readiness EBRI were Notes added article for (VanDerhei, a PensioRatings, n Research September Council by A 2012) ge presentation Cohort analyzed the that imp involved act of increasing a 9 the the with no years of future elig observed Early question re Boomers duof ction what in would adher individual be eibility, 15 percentage-point nce. able hou Eligibility to sehol coveds r 100 for should percen a Defined do t to decrease of increase simul Contribution afor ted th eir those retirement probabiliti Plan with on expenses, ee–nine s of successful year whil s, e a 47 21 retirement percent percentage of Consumer-Directed Health Plans.” American Journa2005 l of Man2006 aged Care, 2007 Vol.2008 17, No. 3, (March 20 2009 2010 11). 2011 2012 90.0% June 2013 • Vol. 34, No. 6 winners/lo the default sers contanalysis o ribution rate f defi for ned benefit fre automatic enezes an rollment d 401(k) the enhanced plans ® with employer automatic contributions escalation provided of to . “A Post . “Massachusetts F -Crisis Assessment of Reti uture Retirement Income Assess rement Income Ament Project.” A dequacy for Babproject of the y Boomers an EBRI Educatio d Gen Xers.” a EBRI Issue Brief, n and Research no. VanDerh Retirement Security Projection Model Engagement in Health Care Survey Among ine divi i an du d als Copeland whose e 10 (2010) m 0.0 ployers % describ contribute e how d to ho the useholds account ar, e intrac moked st years through of thre etirement survey, thag e contributio e and how n th leeir vel Traditional Late outcom point Boomer decrease es. s and for Gen those Xer wisth would 10–19 meet years, this and level a 22 of perc retirement entage-p income oint decrease adequacy). for those Moreov with er, if 20 real or more bond defined contributions. contribution plans at the time the defined benefit plans were frozen (Copeland and VanDerhei, Charlt on, M.E., B.T. Levy, R.R. High, J.E. Schneider, and J.M. Brooks. “Effects of Health Savings Account–Eligible Plans on Medical Homes 354 (Emp Fund and the loyee Milba Benefit Rese nk Memorial F arch u Institute, Febru nd. December 1, 200 ary 2011). 2. Not filled a prescription due to cost or skipped doses to make Where the world turns for the facts 80.0% on U.S. employee benefits. A retirement had third no study impact in examin come/wealth on acc ed ess adh issues. e is rence simul In to 20 ated ma 11,if no in tenanc r divi the duals foll e drugs owi whn ose g an componen d employ found er thts: contribut at drug re ed fills less for than card$ iac 1,0conditions 00 were more and likely 2010). returns years. permanently drop 90 to .0%the five-year TIPS yield that held at the start of 2013 and the equity premium is By By Paul Jack Fronstin, VanD Utilizati erhei, on a Ph. nd Ph.D., D., Exp Employee e En m dployee itures.” Be Be Amer nene fit fit ica Research R n Jour esearch nal of Man Insti Intstitute ute aged Care, Vol. 17, No. 1, (January 2011). medication last longer 22 22 23 21 22 23 23 21 10 Figure 2 shows the percentage of individuals who reported access issues by plan type for those with and without The November 2012 EBRI Notes article (VanDerhei, November 2012) reclassified the RRRs to provide utilizatio than In 2004, EBRI those n of wit ch holesterol an demonstr employer preated s cription contribution the potential drug s odecre f at advan least ased $1,000 tage in both of to annui the report CDH tizin a Pn g an access defined d the issue tra con ditional t(Figure ribution plan, 5). and but In IRA contrast, declin acc ed ount more for still D elay assum . “Oregon F . ed or av Testimon ed oided get to y. U.S. Cong u be ture Retire 6 ting healt percent ress. Senat ment Income A h c 70.0% are due t (denoted o c e H os as tealth, Educ ssessment 4.6/–1.4 atio Pro in n, Labor a the ject.” A project of the EBRI Educatio 17figure), nd P 19 these ensi 16^ ons Comm number 22^s ittee. drop 15^ Tn an by he W an d Re 12^ obbly Stool: other search F 4–5 19^ percent- und14^ and 13 80.0% Chen, S., R.A. Levin, and J.A. Gartner. “Medication Adherence and Enrollment in a Consumer-Driven Health Plan.” medical ? Social homes. S additional Also ecurity in Having 2009, . information a a new medical subroutin on home those e did was substantially not added reduce to ab allow ove access the simu issues, thre lations shold; with of various close one to ex styles the ception: threshold; of target-date Amon and g indivi funds duals for with Retirement and health benefits are at the heart of workers’, employers’, and our nation’s the indivi balances EitC her of d Duals HP tat he abov population. wh retirement ose e employ The fo ers r stsome udy contribute also co h foun od rts le d of ss that than future the $ 1 CD reti ,00 HP rees. 0 w po ere pulatio However, less n lik had ely given than poor er the those drmillions ug with com em pof lia ploye nce simulated r for contri asthma, life butions p aths of 29 30 28 33^ 29^ 28 31^ 26^ age points; Retirem the Milb 40 per e ank Me nt (In)security in America cent morial F of the uEar nd. 2 ly 001 Boomers a. (T-166), 7 Oct. 2010b. would be able to cover 100 percent of simulated retirement substantially a comparison below with participant- the threshold. directed investments (VanDerhei, June 2009). b Results Under Temporary Low-Yield-Rate Scenarios American Journal of Managed Care 16, no. 2 (February 2010): e43 -e50. 60.0% W traditional economic security hat a Sustained Lo coverage, those . Fo 70 with .0%unded in 1978, EBRI is medical w-yield Ra homes were statistically the most authoritative and objective source of te En less livir kely than onment Means f those without medical homor es to Introduction HDHP cardiac, at being least modeled, $1,000 and cholesterol to this report analy co acn s cess d isitions, did issues not and attempt in th 2012, at theto a CDHP nd optimi acc pop ess ze ulation issues the degree incr term eased inated of annuitiz statistic the dr aally u tig on supply among (in essen earli those c ee, r than wi it th was tradit eman ployer io all- nal Established in 1978, the Employee Benefit expenses, Introduction while 42 percent of Late Boomers and 43 percent of the Gen Xers would meet this level of retirement ? Defined contribution balances. Not filled a prescription due to cost or skipped doses to make 11 10 The report information on these critical, complex issues. previo that us they result delayed s assum or avoided ed a perman getting e n ht eshift alth care to on due e of to the cost. alter Ann d ative-inv while the est differ ment-r ence ate was sce statistically narios. While this F ronstin, Paul. . “Retirement Savi . “A Behavior "Findi al Mod ngs from ng es Shortfalls for T l for Predicti the 2012 EBRI/MGA Consum ng E oda mplo y’s W yee Co orker ntri s.” butio er Enga EBRI Notes, ns to 401( gemen no. 10 (Emplo k) Plans.” t in Health C North America aye re Surve e Bene yfit Re ." n Actuari EBsearch Institute RI Issue Brief al Journal , no. , In 2001, Per a cha entage of ndfu l Sim ofulated Lif large, e self-insured employers began offering health reimbursement arrangements (HRAs)—a plan R contributio or-nothing e pati tir ents. e ns proposition). ment Income Adequac of Adhere at least nce$1, wa Su 60 000 s bsequent 50 .0% consistently .0% betweeEBRI n 201 and research 1 a sind gni 20 ficant 12 y: R constructed . ly loweesults F r for C a DbHP uilding patients rblock om the 2013 EBRI by approach all measurin eswhich . all three of 2 20 013 10 In The March 201 April 2010, the 3 EBRI Notes article (Va model was completely nDer re-paramet hei and Ad erized ams with , March 2013) 401(k)-plan used design a modi parafi meters ed version for of income adequacy. medication last longer 32 29* 29* 31* 28* 28* 31*^ 26*^ While several sectors of the economy have benefitted from the U.S. Federal Reserve holding short-term interest 7 Per Paths centage of That W Sim ill Nulated Lif OT Run e Research Institute (EBRI) is the only provides significant, 379 (Emp (200 October 201 a it co 1b). was nvenient lo not ye 0a e a ): 2 Benefit Rese appr lar - g9. e oximation differenc arch e, , what Institute, Decemb with 13 if this perce is not nof er 20 ly those a tempor 12). witha me ry phenomen dical homes on, report as m ing any the analy issue, sts com predict? pared ® sponsors that had adopted automatic-enrollment provisions (VanDerhei, April 2010). A completely the then-ne majw or type retirement of health risk plan s (investment . In 2004, indi risk, viduals longevity with ce risk rtain and high-de catastrophic ductible healt long-term-car h plans we e re risk allowe s) wer d e by the Delayed or av Shor Paths t of the oided get T Money hat W RSPM ill in Retir NtO ing healt to T R em un aent ssess h care due t the pro o c bos ability t that respondent households would not run short of money in 31* 33* 32* 30* 28* 26* 26* 27* ? Individual retirement account (IRA) balances. Retirement Security Pr 50.0% ojection Model, p. 2 rates near zero to support an 40.0% economic recovery, current bond yields are at historical lows, and the poten 11 tial EBRI focus Shor at Var t of Money iouses solel T hr in Retir esholds ement y on employee benefits research — no lobbying or advocacy. EBRI Employee Benefit Research Institute Notes (ISSN 1085 ?4452) is published monthly by the Employee Benefit Research Most Length To with assess perc recently, of ent tthe ime updated o f a impact with those study the versio witho fou of acco a n n d u temporary of unt t that medic the ha tnational h d e aa l C , homes. stati D low-yield-r HP model s result tically Furt was ed hermo signi ate in produced scen fric erant ductio e, ario, one impact for the May 20 ns situati Figur in on the o e access n 4 use was illustrates 10 EBRI policy forum and used offoun issues nond -gene wher the in most ric impact e th prescri e years. likof ep lihood the tion In 2analy 0 dru of in 11g , re s, those spo is rting while Either of the above retireme independent nonpr nt if they did, in fact, accumulat ofit, nonpartisan e the amou 44 nt 44* they said 43*would 43* be require 41* d in39* the 2013 42* 40* F Medicar ronstin, Paul, e Prescription Martin Sep Dru ug lve , Improvement, da, and M.Chri stopher R and Moderni oebz uation ck. "Consum Act of 2 er-Directed H 003 to contre ibute alth Plans R to a hee alt du hc e savings The Long-T account erm simultan In previous eouEmployee sly simulated Benand efit Re optimal search an Institut nuitization e (EBrR ate I) s publicatio were deter ns (e. mined g., VanD for var erhei ious Jun as e set 201 all 2), ocati the ons concept and of at Various Tth hresholds 1 VanD erhe . “Retirement Income A i, Jack, and Lori Luc deq as. “T uac he Impac y for Toda t of Auto-enrol y’s Workers:lment an How Certa d Auto in, Ho matic Contri w Much Wbut ill It Cost, and H ion Esca c lation o w on Retir Does Elig ement ibility for impact Institute, on reti 1100 rement 13 St. incom NW, e Suit adequacy e 878, Washington, has been DC of gr 20005- owing 4051, conc at er $300 n. Recently per year , oF r inke, is included Pfau an as d part Blanchett of a 12membership EBRI stands alone in employee benefits research as an independent, nonprofit, and nonpartisan the July 2010 Issue 40.0%Brief (VanDerhei and Copeland, 2010). CDHP Retirement Confidence Survey. another with shown access the issues in stu accou Figure dy was found nt lon 3, hig but gre h er er ductio had und among er fewer ns two in those prescri acc altern ewith ss pative itssues. ion medical dr scenari ugs Among ho four mes os. indivi years Under than duals aft those the er wit th fiwith e rst, h ado anout the account ption tzero-rea he m of . for a Spec ful l-bond less l-r ifica eplac than lly rate , e a among ment year, is assu HSA. CDHP 42 med percent to 30.0% Use Of Outpatient Physician Visits And Prescription Drugs." Health Affairs, 32, no. 6 (June 2013): 1126-34. household-ri (HSA). RRR ? Defi was Collect ned exp sk bene a ivnded ely, preferences. fit HRAs to annu show an ities d A the HSA afuture nd/or percen -elig lump-su ible EBtRI aplans ge publication m of ar distri simula e kno bution ted w will n as s. life update consum paths these er-dr that iven w results ould hea have flth or both pladequate ans hi (CDHP storical- rs e). tirement and lower- subscription. Periodicals postage rate paid in Washingt on, DC, and additional mailing offices. POSTMASTER: Send address Use of Health Care Services and Access I organization committed exclusively to data ssues by Type of Income Ad Particip orga ation i nization. equa n a Define cy.” It analyzes a EBRI Issue Brief, d Contributio nd rep n Pla no. 34 ort ns Help 9 (Emplo resea ?” EBRI Notes, rch yedata e Benefit Res without no. 9 (Emplo earc spin o h Institute, November 2 rye unde e Berlying nefit Research Institute, agenda. 010 All fin ); and DCIIA dings, Not filled a prescription due to cost or skipped doses to make (2013) analyzed failure rates (in essence, retirement savings being depleted before the end of the assumed 30- th reporte last enrolle exactly es, d th 3at 3fi perce ve they year or nt s of fam after tho ily s e retirement memb with ers me di dic age; d al not homes thereaf fill pres repo ter crrted , ipthe tions not hior storic fillin skipp g al-return prescriptio ed doses asto su ns make mptions due to the cost, are medication roest r skippi ored. last ng The dos longer es to changes to: EBRI Notes, 301100 .0% 13 St. NW, Suite 878, Washington, DC 20005-4051. Copyright 2013 by Employee Benefit return resourcassum es to cover ptions. eith er 80 or 90 percent of the simulated retirement expenses. Lowering the threshold for Greene, J., J. medication las The Hibb t longer new ard, J.F model . Murra was used y, S.M. T to an eutsch, an alyze how d M.L. eligibility Berger. “T for participation he Impact of Consumer-Dir in a defined contribution ected Hea plan lth Plans On whether on financial data, options, or trends, 30 are reve 31*aling 24^ and reli23 able — the re 31*^ aso 28 n EBRI informatio 25^ 27* n is Rese Septemb arch Re er 20 p10): 13– ort (Novemb 2020. .0% er 2010). year period) for 4-percent, inflation-adjusted withdrawals over 30 years with a 50/50 stock/bond asset Health Plan: Findings from Research Institute. All rights reserved, Vol. 34, no. 6. the EBRI/MGA Consumer dissemination, research, and education on Advocates ? Net housin of CDHPs g equity. claim ed that the programs simultaneously provided consumers with broader choices than were sec or make that ond m the scen edica y de ario tion laye adopt last d or lo s avoid nge the r, esame d whi ge le tting approach, 22 per health cent car but of e those thi due s ti twithout o me cost the (Figure medic zero-r al eal-b 6). homes Ino co nd ntrast, repo assu rted mptions among that issue those are .a ssum with the ed to acco las unt t Delayed or avoided getting health care due to cost impacts retirement income adequacy in September 37*2010 38* (VanDer 29* hei, ^ Sep26 tember 22* 2010), and 23* was later 21 25*^ retirement readiness the gold sta from ndard 100 fopercent r private to analysts a 90 percent nd of desi cisi mulated on make rers, tirement governme expe nnses t policy obvi make ously rs, increases the media, and the Health Care Us Prescription Dr e an ug Use.” 20 d Access Issues by Plan Type .0%Health Affairs 27, no. 4 (July/August 2008): 1111 -1119. allocation for three different asset-return assumption 8 s: References Either of the above 10.0% 48 49* 38*^ 35 41* 38* 36 38* through currently Engagement in Health Care Survey for one to the avail tw used o fiable, rst years, to 10 wh compute year 33 ile per the s after cent RSSs consumers’ rretiremen e for ported Baby asome ggre Boomers t. gate type and deci of Gene a sccess ions ration would issue, Xers , cap and pin .costs 13 October amon more g those 2010 effe (Van with ctively Derh the tha ei, account n October top-do fown, r three or W h iteho . “T use, Mark, “Another T he Impact of Automah tic Enrollm reat to Econ ent i om n 401(k) Pl y: Boomers Cutting Back,” ans on Future Retir We ament Accumu ll Street Journal latio , Apri ns: A Simulatio l 16, 2010 n Study Based the publi economic security and employee benefits c. . ® RRR. Applying historical-return assumptions to the case of Early Boomers, the RRR increases from 55 percent to Haviland, A.M., N. Sood, R.D. McDevitt, and The 2012 EBRI/MGA Consumer Engagement M.S. Marquis. “T in Health Care he Effects Survey, of along Cons with ume resu r-Dir lts ected Health Plans on Epis from past years, can be odes of used to Appendix A: Brief Chronology 10.0% of EBRI-ERF Retirement Security Projection Model Sources: EBRI/Commonwealth Fund Consumerism in Health Care Survey, 2005-2007; EBRI/MGA Consumer Engagement in Health Care Survey, 2008-2012. A Overall, household individuals is conis nidered HDHPs to and run CDHPs short of were money more in likth ely is than model those if ag with gregate traditional resoucovera rces in ge retirement to report access are no t 2010a). Copeland, Craig, and Jack VanDerhei. “The Declining Role of Private Defined Benefit Pension Plans: Who Is Affected, and conventionally managed care plans The Em had done. ployee BBenefi ut some t Research Institut analysts warneed (EB thRI) was founded in 1978. Its at consumers lacked the discipl mission is to ine and more years, on Pla 32 npercent Design Modificati reported ons some of Large Pl type of acc an e Spons ss issue. ors.” In EBRI Issue Brief, 2012, the picture no. 341 (Emp changed: lo Those yee Ben with efit Re an acco search unt at a 66 percent, while redefining 0.the 0% threshold to only 80 percent of the simulated retirement expenses provides an TM ? T radi Historical tional = healaver th plan w ages: ith no deduct an arit iblh e or metic <$1,000 ( mea indin v idual of 8.6 ), <$2, percent 000 (famil yr ).eal returns for stocks and 2.6 percent real returns for examine Healt plan-partici h Care.” pant Forum reporting for Health Econom of health care ics access & Policyissu , Vol. 1 es for 4: Iss. 2 (Health Polic themselves and th y), Articl eir family e 9. (2011). members. The survey 2001 The EBRI-ERF Retirement 8.Security 6/2.6 Projection 6/0 4.6/- 1.4 Model 8.6/2. (RS 6 PM)6/ grew 0 ou 4.6/- t 1.4 of a mu 8.6/2. lti-year 6 project 6/0 t 4.o 6/- 1.4 sufficient to meet minimum retirement contribute to expenditures, , to encourag defined e, and to enhanc as a combinat e the developmen ion of determini t of sound empl stic expen oyee ben ses freom fit Figure issues, 4 both shows for those that, with at tha e n100-percen d without medical t-expense homes. threshol d, as expected, the overall impact of a temporary, How.” In Robert L. Clark and 0.0% Olivia Mitchell, eds., Reorienting Retirement Risk Management. Oxford University b sophistication least three Institute, April 201 years to understand were mo0). re likely what than care is tht ose ruly with necessary an account , much for less less suth ccessfully an one yea navi r to gate experi an ience ncrea access singly com issues. plex This EBRI explores the breadth of employee benefits and related issues. HDHP = high-deductible health plan with deduct 8.6/2.ibl 6 e $1, 6/000+ 0 ( 4. indi 6/-v 1.4 idual 8. ),6/2. $2, 6000+6/ (f0 amily 4. ),6/- no account 1.4 8.6/2. . 6 6/0 4.6/-1.4 8.6/2.6 6/0 4.6/-1.4 additional increase to 81 percent. Early Boomers Late Boomers Gen Xers Endnotes Who we are In October testimony before the Senate Health, Education, Labor and Pensions Committee on “The bonds. analyze the future economic programs and so well-being und public policy of the retired population through objective at the resear state ch and level. educati EBRI and on. EBR the Milban I is the only k included questions on medication adherence and delay/avoidance of health care. A T A G L A N C E Jaffe, Jim. "Ex c ecutive Summary." In Consumer-Driven Health Benefits: A Continuing Evolution? by Paul Fronstin. low-yield the Consume -rate r scen Expenditure ario on RRRs Survey is signif (as a icantly function less of th ag an e and the income impact ) of and a perman some h ent, ealth low-yield insuran-rate ce and scen ouario. t-of- For Press for the Pensi The Institute seeks to advance the public’ on Research Cou01 ncil, 2010: 122–136.-9 s,10-19 20+ CDHP = consumer-driven health plan with deductible $1,000+ (individual), $2,000+ (family), with account. health care system. EBRI studie Those s the worl analysts 80% d saw 15 of health and retirement ben .2%the init 18.8% iative 20 as .7% an opportun 14.2% efit ity 18 s .1% for — issue employ 19.9% s such a ers to 13.6% transf s 401(k)s, er 16.8% a growi IRAs, retire 18.5% ng portio ment n of reversal is due to the fact that between 2011 and 2012, access issues declined for those with an account less than 1 Wobbly Stool: Retirement (In)security in America,” the model was used to analyze the relative Memorial Fund, working privat with e, nonprof the office it, nonpar of the tisan govern , Washington, DC-b or of Oregon, set ased organi out in the zatlate ion com 1990s mitted exclusivel to see if this y to See Whitehouse (2010) for an 80%example. 18.5% 20.2% 20.8% 13.0% 16.7% 17.9% 9.6% 13.8% 17.0% 5.0% 11.0% 14.6% . “Falling Stocks: What Will Happen to Retirees' Income s? The Worker Perspective,” Presentation for The Economic Washington, DC: Emplo 1 90% yee Benefit 10.9% Res 14.9% earch Institute, 200 16.6% 11.2%2. 14.6% 16.0% 9.5% 12.4% 12.2% pocket * Differ, ence bet healt wh een HDHP/ -related CDHP and T expense radi s, tional plu is s st st atochastic istically signifie cant xpe atnses p = 0.05 or from better nur . sing-home and home-health care (at least example, when incom the e ade 100-per quacy, cent cothreshol nsumer-drive d is used n benefits, , the RRR Socia for l th Security, ose with tax treatment of both retireme no future years of eligibility decreases nt and health Figure rising one year, costs 1 shows whil to importance e emp they that loyees. incr the of eoverall employer-provided ased for impact public those poli with of ca retirement y r an permanent, es earch accouand n benefi t three lo edu ts w-yield- cat and or ion on mor Social rate e econ years. Security scenari omic so (VanDer ecuri on ty R Rah R nd em ei, s dep October plo ends yee b 2010b). on enefi the t is lesu vel es. of Income Differences situation could be evaluated for the state. The resulting analysis (VanDerhei and Copeland, 2001a) ? Zero-real-retuthe media’ rns bond 90 re % tur s and policymaker n 10s: .9% 6.0 11percen .7% 11.7% t real 10 for .s’ knowledge 1% stock 12.2%s and 11.4% 0 perc 8.3%ent 13real .7% for 13. 8% bond 5.s 7% 11.9% 12.6% To examine health care access issues, the sample was divided into three groups: those with a CDHP, those with a 100% 55.1% 45.2% 40.2% 57.5% 47.2% 42.0% 57.2% 47.0% 43.1% Finke, Michael, Wade D. Pfau, and David M. Blanchett. 2013. “The 4 Percent Rule Is Not Safe in a Low-Yield What a Sustained Low-yield Rate Envi ^ Estimate is statistically different from the prior year shown at the p = 0.05 or ronment Means for Retirement Income better. Crisis of 2008: What Will Happen to Retirees’ Incomes? 2009 APPAM Fall Conference (November 2009). benefits, cost management, worker and employer attitudes, policy reform proposals, and pension assets from until the 39 perc point ent such at hi expenses storical return arEBRI’s member e cover s to e 36 d by percent ship includes a Medicaid if the ). Thi zero-real cross-section of s version -bond-return of pension funds; businesses; trade associations the mod assumpti el is conon structed is expect to simul ed to alte ast ; Parente, S.T., R. Feldman, and Y. Xu. “I 100% mpact of Full Replacement with Consumer Driven Health Plans on Total Health Care 2 focused primarily on simulated 38.6% 33.retirement 0% 31.0% wealth 59.8% 48 with .8% a 45 comparison .3% 73.4% to 58.5% ad hoc 52.3% thresholds 86.1% 70 for .7%retirement 63.6% simulated retirement expenses used as a threshold, and that a lower threshold mitigates that impact. For ® Treasury Inflation-Protected Securities. Fig high ure -deduct 3 shoibl ws e the health perce pla nta n (HDHP), ge of indivi and duth als ose reporti with ng tradit acce ional ss issues healthby coplan verage. type Indivi and duals over time were fo as r signed those ato bove eithand er World.” Journal of Financial Planning 26 (6): 46–55. Adequacy: Results From the 2013 EBR and fundi and under ng. There is wi standing of employee benefits and despread recognI ition Re that if employee be tirement Securi nefits ty Projection Model, data exist, EBRI knows it. 2011 labor unions; h 2 ealth care providers and insurers; government organizations; and service firms. In February the model was used to analyze the impact of the 2008–2009 crisis in the financial and real retirement This report ex in expenditures. come amines ad th equacy, e impact as ofnoted plan type, above. meAltern dical hat ome ive s, ver and sion inc s ome of the on mod use e ol f allow healthsimilar care seanaly rvices. sis It fo ar lso for the first Cost and Us five year e of Preventive S s after retirement ervices.” and to Insur 35 ance Mark percent ets and C if expected ompa to nlast ies: A 10 nalyses an years. This d Actuaria RRR decrease l Computatio of ns , ? Real bond returns equal five–year TIPSFuture yield Years at of th Eligibility e starin t of a Def 20 ine13: d Co nt 4.6 ributpercent ion Plan real for stocks and –1.4 percent example, if the 100-percent threshold is used for Early Boomers, the RRR decreases from 55 percent at . Testimony. Joint DOL/SEC Public Hearing on Target Dates Funds. How Would Target-Date Funds Likely Impact belo the C w D$ HP 50,or 00 t0 he ofHDH annP ual grou household p if they incom had ae. de In ducti every ble y of ear at bet leas wt e$1,0 en 20 00 05 for and in divi 2011 dua fo l r covera every ge plan or t$2,0 ype, 0i0 ndivi for dual family s in Conclusio estate n markets on retirement income adequacy (VanDerhei, February 2011). by Jack VanDerhei, Ph.D., EBRI 3 ® Source: EBRI Retirement Security Projection Model Versions 1750, 1755 and 1760. 3 replacemen examin and 4 es Vol. 1, No. 1, (201 percentage diff t e rates, rences standar poin in thts 0). e use d is-of-living less of hea than lth cal th services ce ulation 6 percentag wit s, and hin the e other point CDHP ad decrease po hopulation. c thresh from olds. Data that from illustrated the 200in 5-2 Figure 007 3 when their importance to our nation’s economy. VanD In this real erhe an for i, Jack. “All or Nothi alysi bonds s, Early . Boome ng? An E rs are defined xpanded Pers as those pectiv born e between 1948 on Retirement Read and1954; iness.” Late EBRI Notes Boomers as born between 19 , no. 11 (Employee 55 ® historical Fu retu Source: EBR ture 401(k) rns Ito Retirement Security only Contri 40 butio percent Projection ns? (T Mat odel -160), June 200 th Versions e level 1750, 1755 and 1760. based 9. on current TIPS yields. This drop of 15 percentage points Return assumptions are presented as arithmetic means for equities and bonds as real returns. Investment expenses are not incorporated in this version of the households 2 coverage. 002 To wi With the assistance of the Ka be th as less sigtha ned n to $50,0 the0 CDHP 0 in ann gro nsas Ins uup, al inth come uey rance mus we Departme tre alal so ways have nt, stati EBRI had stically an was accou able signi nto t, ficsu create antly ch as more the anEBRI HSA likely Retirement or than HRA those with a in EBRI delivers a steady stream of invaluable research and anal EBRI’s work advances knowledge and understanding of emplo ysis. yee benefits and their There is a growing body of literature that draws mixed conclusions when it comes to the impact of consumer-driven Return assumptions are presented as arithmetic means for equities and bonds as real returns. Investment expenses are not incorporated in this version of the model. EBRI/Commonwealth Fund Consumerism in Health Care Survey and the 2008-2012 EBRI/MGA Consumer Engagement the decrease was projected TM to be permanent. and1964; Benefit Res and Generation Xers as born between 1965 a earch Institute, November 2012): 11– nd 23. 1974. Parente, S.T ? Overall, 25–27 percent of Baby Boomers and Gen Xers who wo ., R. Feldman, and S. Chen. “Effects of a Consumer-Driv uld have ha en Health Plan d adequate reti on Pharmace rement income under retur utical Spending and n is larger than An the April similar 2011 acomparison rticle introduce at d a a 90 new percent method threshold of analyzin(a g t9 h e percentage results from p the oint RSP drop) M (Va and nDerhei, much April larger model. Readiness Rating (RRR) importance to based on th a e nation’s econo full stochastic decumula my among policy tion model makers, that the news took into media, and account the the public. It households rollover provision wi th $that 50,0 EBRI they 00 or cpublications more ould use in in ann clu to pa u de ay l in-de income for m peth dica to cove rl eex port rage penses that of key issues a they or to or take a fa th mily eir nd ac m tren count ember ds; with summ did not tharie e m fill s should aof rese prescriptio they arch n, The baseline version of the model used for this analysis assumes all workers retire at age 65 and immediately health plans (CDHPs) on preventive and screening services. This research finds that access to health care services is . “The Expected Impact of Automatic Escalation of 401(k) Contributions on Retirement Income.” EBRI Notes, no. 9 They found a 6 percent failure rate for their Monte Carlo simulation when they applied the historical averages. in Health Care Survey are used for the analysis. 2011). Rather than simply computing an overall percentage of the simulated life paths in a particular assumptions b Utilizati household’s on.” aHe sed on historical averages ar alth Servic longevity es R risk, does this b epost-retirement searchy 43, no co e simulated to nducting . 5 (October 2008): 154 investment and pend up r ublishing policy re risk, and unning exposure 2– sho 155sear 6. rt o tch, analysis, o f mo potentially ney in retirement and catastrophic special reports on if today’s than the difference at an 80 percent threshold (a 4 F pie gur rcentag e 2 e point drop). What we do findings and policy developments; timely factsheets on hot topics; regular updates on legislative and 4 s chang kippee d jdos obse . sI ndivi to make duals the wit medicatio h only a flex n las iblte long speer, nding or d ac elayed count or (FSA avoi ) w de ed re getti not ng inc hea luded ® lth in care the dC uD e H to P cos grotup. . (Stat istical .“ Increasing Default Deferral Rates in Automatic Enrollment 401(k) Plans: The Impact on Retirement Savings Success Similar an begin issue to results across withdraw are the EBRI’ seen money board. fs mission is to contribute to, to o B rf y rGen om health their Xers plan indi with type, vidual future differenc accoun years ets s ofwer (d defined efined contribution and cash bal e foun -c d ontribution among indivi -plduals an eligibility. in CDHP ance plans, as well as s, For high those -deduct with ible one Appendix (Emplo A provides yee Bea nefit Rese brief chronology arch Institute, Septe of the Retirement mber 20 Security 07): 2–Projection 8 Model. The failure rate cohort that would no jumped dramatic t have s emplo ally y to u ee benef fficient retirement 33 percent its issues; holding educational br for re income al bond to pay returns for the iefings for EBRI memb that sim eq ulated ualed expense zero an ers, congressional and s, d the 57 new percent for nursing-home and home-health-care risks. historically low regul interest rates a atory development re assumed to s; comp be a perman rehensive ent refere condition, nce resou assu rming ces oreti n benefit pro rement income/wealth covers grams and workforce Access Issues, by Type of Health Plan and Medical Home, 2012 Rowe, J.W., T. Brown-Stevenson, R.L. Downey, and J.P. Newhouse. “The Effect Of Consumer-Directed Health Plans On significance tests are not shown in the table.) in Plans With Auto method computed the percent matic Escalation.” federal agen age of househo EBRI Notes cy staff, and th , no. 9 (Emplo lds e news that would media; ye meet and sponsoring public opinion survey e Bethat nefit Rese requirement arch Institute, Septemb more than a s on emplo er 2012): yee IRAs) whenever the sum of their expenses and uninsured medical expenses exceed the projected, after-tax to health nine pla years, ns (HDHPs), a five-year, and tlh oose w-yield with-rate traditional environment coverage. after Unlike retirem in 20 e11, nt would the surv resu ey lt foun in a d 4 statisti percentage-p cally signoint ificant those that equaled negative 1.4 percent. Figure 2 illustrates the impact of permanent, low-yield-rate scenarios on RRRs by preretirement wage quartile. issue encour s; and age major survey , and to enhance the development s of public attitudes. 5 100 percent of simulated retirement expense. Individuals were assigned to the HDHP group if they did not have an account used for health care expenses with a Prior Research The Use Of Preventive And Chronic Illness Services.” Health Affairs 27, no. 1 (January/February 2008): 113 -120. . “Measuring Retirement Income Adequacy: Calculating Realistic Inc Has a M ome Re edical plac emD ent Rates.” oes Not HavEBRI Issue Brief, e a no. specified percentage of benefit issues. times in the EBRI’s Ed simulation. ucation and Research Fund (EBRI-ERF) performs the charitable, Returns are The assumed to follow first state-level a RSPM log-normal results distribution. were presented to the Kansas’ Long-Term Care Services Task Force on 12–22. decrease d annual ifference inc s in ob m the etw e from e RRR, en th Soci whil ose al e wiSecurity a th10-year traditiand onscenario al defined coverag would e benef and decr iCD t plans HP ease en(if rol the an lees RRR y). inIf 2 by 0 there 17 2. percentage is sufficient pom ino ts ney (compared to pay to EBRI meetings present and explore issues with thought leaders from all sectors. The impact of changing from the historical-return assumptions to the two lower-interest-rate scenarios is Home** Medical Home** educational, and scientific func Figure 4 tions of the Institute. EBRI-ERF is a tax-exempt organization However, rollover provision in 2012,or wh portabili ile differences ty if they amon chan g ged tra djo itional bs. T his plan grou enrolle p inclu es d ae nd d in Hdivi DHP duals enro with llees H re SA-e maine ligid b le statistically health plans but 297 (Emp July 11, loye 2002 e Benefit Rese (VanDerhei aand rch Institute, Septemb Copeland, July 2002), er 20 an 06 d the ). results of the Massachusetts study were of sound employee benefit progr Figure 2 ams and The literature is mixed when it comes to the impact of CDHPs on preventive and screening services. While ? A low- this provides yield-rate environment dramatic evidence may have an of how extremely large im sensitive the failure pact on rate retirement- on this ipor ncot me ionfa of ilure rates when viewed in the retirement portfolio expenses without tapping into the tax-qualified individual accounts, those balances are assumed to be invested 11 percentag e points EBRI regula if that ryield ly provides environment congres was sionp al erman testimony ent). , Fan or d those briefs p with olicy more make thran s, mem 10 years ber o of rga futu nizations, re 6 supported by contributions and grants. a negligible for the lowest-in Impact come of Low quartile -Interest-Rate Scenarios on Gen even at the 100-percent-expense Xers threshol During d: ththe e RRR decreases only Endnotes As explored in the June 2011 EBRI Issue Brief, the RSPM allowed retireme Traditnt-income ional adequacy to be . “Is Wpresented orking to Age on D 70 ec. Real 1, 2002 ly the Ans (VanDerhei wer for Retire and Co ment Income A peland, December dequac 2002). y?” EBRI Notes, no. 8 (Employee Benefit signific may Thro als ugho ant, o have ut t amh ong inclu is Notes Cde DHP d article, indiv enro iduals llees, the various with indivi a dreturn h uigh als in de scenarios househ ductible olds are who referred wit are h le not ss to than eligi by b the $50, le to means 00 co0 nof tribute of an their nual to arithmetic a hou n HSA. sehold real Ind income ividu returns. als wer e Impact of Low-Interest-Rate Scenarios on Retirement Regardless of health plan type, individuals in households with less than $50,000 in annual income were more likely isolation. Hoand wever, the medi the impact a on employe is muted somewhat when included as p r benefits. art of the entire retirement portfolio (e.g., Social may be to bond-return assumptions, the fact that most of today’s households will have othTM er components (such eligibility, in a non-tax-advantaged the RRR sound public policy thr would account wh decrease 4–5 ere the investment income i percentage ough objective points under s a ta five-year xed as ordinary scenario income. and 8 pe In rcentag dividual e poi accn ots unts assessed at retirement ages later than 65 (VanDerhei and Copeland, June 2011). 1 . “Defined Benefit Pl First 5/10 an Freezes: Years Who' of Retirement s Affected, Howon Retirement Much, and Replacin Readiness 2g Lost Accruals.” Ratings, EBRI Issue Brief, no. 291 Not filled a prescription due to cost or skippTM ed doses to 0.4 percentage points (from 16.4 percent to 16.0 percent) when the bond return is assumed to decrease from Research Institute, August 2012): 10–21. One This should not See Jaffe (200 study exam be interpreted as 2). ined four emReadiness Ratings, ployers a determini that adopte stic return d a full simulation. by -replac Preretirement ement CDHP. Wa It ge foQuartile und that with every one of the not with statisticall traditionay l more health lik cov ely et ro a ge report wer enot parti filling cipants prescripti in a br on oad s du rae nge to cos of plan t or skippin types, g inc doses luding to healt make h maintena medicatio nce n last than those in households EBRI issu wi es th pre $50,0 ss 0 rele 0 or asmore es on ne in ann wsworthy ual income developm to report ents, acce and i ss issues. s among the most widely quoted as SoSecurity benefi cial Security, ts, possible def defined benefit ined benefi accruals t ac and cruals, net and net housing ho equity using equity ) that )will . have little, if any, sensitivity to are 2003 track ed The un m til ak RSPM the e medi point was cation l expanded at aswhich t longer to th a ey national are depleted model -- . At the that first p national, oint, 21 any micro-sim net hou us lation, ing equity 21 retirem is eassumed nt-income-to be assuming a 10-year scenby ario Future (comp EBRI Issue B Y aears red with of Eligibility riefs a 15 are period percen for a icals providing exp tage-point Defined decrease Contribution ert evaluati for ons of emplo a five-year Plan yee benefit issues and scenario if it was (Employee Benefit Research Institute, March 2006). historical levels to zero. 2 research and education. longer. organizations prevent iFurthe ve me(HMOs), rmore, asures, the at PP le diff Os, ast erence other one firm m by anaged-c inco experienc me are in ethe d plans, a perc dec and rease enta plans ge in reporti prwit eve hn n a tion g broad that or th scree vari ey ety delaye ning, of cost-sh thre d or e avoid of aring the ed fo arran ge ur tting m gements. easures health sources on employee benefits by all media. See Parente, Feldman, and 10 Xu 0.0% (2010). In a July 2011 Delayed or av EBRI oided ge Notes tting article health c(VanDerhei, are due to cos July t 2011), the RS 13 PM was used to provide preliminary 15# 7 adequacy model, 100.0 built % trends, as well in part from administrative as critical analy401(k) ses of emplo data. yee benefit po The initial results licies an were d proposals. presented EBRI Notes at the is a these . “Retirement Rea assumptions leaves dinesmany s Ratings a public-policy nd Retireme analy nt Savings Shortfalls for Gen X sts wondering what a sust eai rsned, : The Impact of low-yield-rate Eligibienviro lity for nment permanent). added Our to retirement savings in the form of a lump-sum distribution (not a reverse annuity mortgage). If all the Whether households should rely on rising bond rates for their retirement planning is of course an open question. Finke, ? There appears to be a very limited impact of a low-yield-rate environment on retirement income adequacy for those in decreased for all EiEBRI ther firms of t ,direct hbut e ab n ov s oe ne membe of the rs fir am nd s other constit experienced decreas uencies es to inthe informatio all 26preventiven se they need an rvices 27 and scd reenin unde g rtakes new care Having 3 The shared due a to mech evidence co diaracteristics st cal was home of no the did lon of impact g not er this statistically remonthly group duce of the ac were “20/20 period cess signific that issues, ical providing current informati caps” ant. they on wi Ho ei th pr ther wever, ojected oneh e ad x wh cept reti no en remen deducti iotn: he Among tt on on a variety of employ w accu b o le varia or mu ina lation dividuals b deductible les wer s propos ew com ith th ed traditional a btee b iby nwas ed, th enefit topics. e the belo w EBRI December 2003 policy forum (VanDerhei and Copeland, 2003). The basic model was subsequently . “Projections of Future Retirement Income Security: Impact of Long Term Care Insurance.” 2005 American Society on See Rowe, Brown-Stevenson, Downey, and Newhouse (2008). would mean Particip for ation i retiremen n a 401(k) Pla t 90 income .0% n.” adeq EBRI Notes uacy for , no. 6 (Emplo future cohor yet e Benefit Res s of retirees. earch Institute, June 2012): 9–21. retirement savings are exhausted and if the Social Security and defined benefit payments are not sufficient to However, the decrease is much 90.0% more substantial for the other three income quartiles: b 8 percentage points for Pfau and Blanchett (2013) review the extant literature and conclude that there is little evidence to support the assumption National resea Comm rch on a ission n on ongoi Fiscal ng Responsibility basis. and Reform. HDHP the lowest- (pre-retirement) income EBRIef quart is a weekly ile, given roundup of the relatively EBRI resear small level ch and of defined contribution and insights, as well as updates on survey IRA assets and s, modified to quantify the beneficial impact of a mandatory contribution of 5 percent of compensation for dif coverage, current measures. fere publications n ce thresh tho in Decreases ts h olds e e with aggr that me egat were wou dic e found al lcontinue d homes quali des fy d wer p for to ite e H be the S statistically A statistically fact tax prefer that lth eence, sss e igni costs likfely icant. and for than t hthese at th they ose services did withnot out were h medical ave covere an HRA-based homes d 100 to preport ercent plan. tha by t all they Aging/National Council on Aging Joint Conference, March 2005. 4 CHECK OUT EBRI’S WEB SITE! pay expenses, the entity is the See second-in Buntin, Haviland, come EBRI has earned widespr quar McDev tile idesignated as tt, and and double-d Sood (2011). igits having for ead r run both short egar the third- d as of moand ney fourth-incom at that point. e quartiles (12 and 10 per- that the higher real interest rate w Not filled a prescription due ill studies, litig return to co in stthe or atio sn, leg medium-term kipped dos islation an es to horizon. d regulation affecting employee benefit plans, while EBRI’s EBRI maintains and analyzes the most comprehensive database of 401(k)-type programs in the testimony for the 80 80Sen .0% .0%ate Special Committee on Aging (VanDerhei, January 2004). the relatively large contribution of Social Security benefits for this group. However, there is a very significant impact for Conclusion four employer . “Retirement Income A s in the study. dequacy for Boomers and Gen Xers: Evidence from the 2012 EBRI Retirement Security delayed or avoided getting health care due to cost. Furthermore, among CDHP enrollees the likelihood of reporting This analysis attempts to provide a first set of answers to this question by using the EBRI Retirement Security make medication last lon Blog ger supplements our regular publications, offering commentary 25 27 on questions received from * 5 The August 2011 EBRI Notes article (VanDerhei, August 2011) used the RSPM to demonstrate the world. Its computer simulation analyses on Social Security reform and retirement income adequacy centage points, respectiv ®ely). A similar outcome occurs when comparing the historical return scenarios with See Ch . Tarlton, estimon Levy, y. U.S. C High, ong Scress. Senate S hneider, 9 and Br peci ooks al Comm (2011). ittee on Aging. Do We Have a Crisis in America? Results From the Over In 2012 time, , 26 there –40 pe was rce n no t of chre an sp ge on in de the nts per repcent orted re some portin typ g access e of access issues issue for the for lowe either r-income themselves group or among family C members. DHP the top three ®income an organization that “tells it like it is quartiles. ,” TM 8 Projection Model. ” EBRI Notes, no. 5 (Employee Benefit Research Institute, May 2012): 2–14. access As shown issues in previous was higher research, amon 70.0% g those a low-yi with eld-rate medical envir homes onment than those may ha without ve an textr hem. emely large impact on 70.0% Projection Mod Del elay ed (RSPM) or avoided to ge determine news reporters, policy tting health c the areimpact due to cm on osak t the ers, and others. EBRI’s EBRI Retirement 26* Readi Fundamen ness 28 tals Rating * of Employee Ben (RRR) for Early efit One of the pr impact imary of output defined s benefit of the R plans SPM in is achieving the produc retitrement income adequacy ion of RRRs for various fo sr B ubgroups aby Boom of ers and Gen the population. The 200 Finke, Pfau 4 The mo and Blanchett (2013) performed a similar anal del was enhanced to allow an analysis o ysis fo f the impact o r reversion f annuitizing to the histor defined co ical bond ntributio returns nafter and IRA the first five are unique. those based on the current, five-year TIPS returns: The RRR decrease for the lowest-income quartile is only 6 EBRI-ERF Retirement Security Projection Model (T-141), 27 Jan. 2004. enrolle Fin Other dEBRI’s website is easy to use and packe ings stu es, from dbut ies have the the h survey ifo gh un er-i d in nc sidicate milar ome lev gro that euls p in of re di ported use viduals of pr declin inev HD ent eHPs si ve, in d with useful information! Look for wer acanc num e er-scr mor bere of eenin like years, ly g tha serv most n in ice dividuals s rece and ntly dia w for b ith etic prescription traditional -monitorin cov g dru eg rage s in 3 See Haviland, E Sood, ither oMcDevitt, f the aboveand Programs Marquis (2011). offers a straightforward, basic explan 38* ation of employ4ee ben 2* efit programs in the retirement in Xers. come failure rates, viewed in isolation. However, the impact is muted somewhat when considered balances at retirement age (VanDerhei and Copeland, 2004). Baby Boomers, Labased on the f te Boomers, 60.0%and acts Gen. A eration s the Bylaws state: Xers based on the different return scenarios used in Finke, Pfau RRR or 10 years of r is defined etirement but used the curre as the percentage of simnt, five-year TI ulated life paths PS return i that do nste not ad run of the zero short ofreal return use money in reti d in this rement. Notes In thi s 60.0% c 3 . “Modifying the Federal Tax Treatment of 401(k) Plan Contributions: Projected Impact on Participant Account 0.5 percentag Percentage of e points, Simulated Lif but e the decrease widens to 11 percentage points for the second-income quartile and Percentage of Simulated Life private and public sectors. The EBRI Databook on Emplo CDHP yee Benefits is a statistical services between HRA-based enrollees and preferred-provider-organization (PPO) enrollees over a three-year period, Among 201 7 to report 1, an individuals d that an ithey ncrease wit or h family i n an 20 H1 R members 2A in or delayin HSA, did very g not or few avoidi fill prescripti ding fferences getting ons in healt or access skipp h cae issues re d d due oses we toto re cost. make found Lower me accordi dicati -incom non g e to last HDHP wheth longer enro er or or llees not that as par these special features: t of the entire retirement portfolio (e.g., Social Security benefits, possible defined benefit accruals, and See Fronstin, Sepulveda, and Roebuck (2013). Use of He and Blanchett Paths Paths alth Care Services a T That W hat W (2013), ill ill N NO OT T R R assu un un ming a permanent nd Access I shift in the ssues distribution by Type of Health Plan: Findings of the expected returns. The analysis also VanD article, article. EBRI make erhe It the is i, Jack, and Crai als RRRs o important s information freel are suppl g Cop to emented note elath nd. “T at their wit hy eh av Impact of Defe study metrics ailable to al started on th trring R hose e simulation l. with etirem suffi ent Age o atcient retirement, retireme n Retiwhereas rement Incom nt resource the Bab es Adeq y to Boomers and cover uacy.” 80 EBRI or Gen 50.0% 4 Balances.” EBRI Notes, no. 3 (Emplo reference work o yee Be n emplo nefit Rese yee ben arch efit pr Institute, March 201 ograms and work force-related issues. 2): 2–18. 17 percentageN points ot f“In all its activities illed a pr for eb sc orth iption due the third- to cos, the Institute shall and t or sfourth kipped dos -incom es to e quartiles. In sum, the lower interest-rate scenario In September, it was used to support testimony before the Senate Finance Committee (VanDerhei, 2005 Shor Short of t of Additio Money Money n in Retir in Retir al refinements were intro em ement ent 50.0% duced to evaluate the impact of purchasing long-term-care insurance employers moderate reporte they ded laye a re n co d ductions in n or c trease ribute avoide d in ind to the acc get the euse tss ing account, issues of healt prevent h in alth car 20ie ough ve 11, due services, whic di toffer h cos dro et nc . fppe e Ov es wer erall, by d in off the 20 ice 40 level 12. vis percent HDHP its of , few coo ntrib behavio fe those r eme utior rin n s gency w were an ere HDHP - de foun unpart cha d reported ment n in ge 2d 012. ivis n some th its Finally e , atnd y, pe 8 net housing EBRI equity). assume The s analysi a publi s c in service re this article spo sh nows sibility that, to make overall, its finding 25–27 percent s completely of Baby acce Boomers ssible at and www.ebri.org Gen from the EBRI/MGA Consumer Enga shows Xers in this hIssue Brief, ow at Var study this iousvaries will Thr no. 358 (Empl es have holds by a (preretirement period oof yee Benefit Res time before ) income they eargement in Health Care Survey, quartile ch Institute, June 2 reach retirement and yearage. s 01 of 1). future Similar eligibility to their analysis, for a by defined th Paul is Notes Fr contrib onstin article ution , did 90 See percent Parente, at Var of Feldman, m simulated ious ak T e m hres edi holds c and atexpenses. ion l Chen ast lon (2008). ger 33* 22# September 2011) in analyzing the potential impact of various 5 types of tax-reform options on retirement 6 • EBRI’s entire lib on retirement income rary of research publicat adequacy (VanDerhei, 2005). ions starts at the main Web page. Click on EBRI has a progressively larger impact on simulated retirement readiness as income rises. 40.0% reductions in breast-cancer screening, cervical-cancer screening, as well as in inpatient care and visits to specialists. lengt h of igaccess heh r -of inc time issu ome e, with gcompar roup the . acco ed with unt 26 did perce appear nt amon to have g thos an im e w pact ith tra ond acces itional s issues coverage in 20 (Figure 12. 1). Nearly 4 in 10 (38 per- function strictly in an objective and — so that all deci 40.0% sions that relate to employee benefits, whether made in Congress or board rooms or Xers wh . “T o ax would Reform Opti Delay have ed orhad ons: avoi Promoting R ded adequate getting heal reti eth c tirement Sec rement are due to incom u cos rite y t .” und EBRI Issue Brief, er return 2as 5*sumption no. 364 (s Eba mplo sed 25 ye*on e Be hi nstoric efit Researc al aver ha ges Ph not 9 plan, .D., attempt as EBRI well to as model by selecti short-t on erm of capi a sptal ecific loss es adequacy on the bond thresh portfoli old (e.g o that ., sufficient may result retir from eincrease ment resour in yields. ces to cover income. This was expanded Contact EBRI in the November Publications, (2 2011 EBRI 02) 659-0670; Issue Brief fax publication (VanDerhei, November orders to2011). (202) 775-6312. See Green Issue Briefs e, Hibbard, and Murra EBRI Notes y, Teutsch, an for our in-depth and d Berger (2008). nonpartisan periodicals. Most cent) recently, of . “T those he EBRI Retireme families’ with E it ither was a ofou ho fCDHP thm e ab nd e n s, tt ov reported Readi hat are e aft based ness R er some four on the highe ating: years type TM of un Retirement Income acces der st a squalit f ull issue, -replaceme y, statistically most depe Prepar nt 40* HSA ation hi nda ghe plan, bl an r e d F th informatio th an u ere ture Prosp those wer 36* e n. with few EBRI’s Web ects.” traditional er of EBRI Iss fice visits, site ue and posts 30.0% Consistent Institute, Nove with the Finke mber 20 , Pfau 11).and Subscriptions to Blanchett EBRI study Issue Bri return eassumpti fs are included ons, as part of the versEBRI ion of membership, or as part of the RSPM used in thi a s are 2006 simul ated to end up running short of money in retirement if today’s historically low interest rates are The model was used to evaluate the impact of defined benefit freezes on participants by simulating the 100 percent of simulated unbiased manner and not as an advocate expenses, as opposed to 80 or 90 percent). Finally, an intermediate scenario is Figure 3 analyzes the impa 30 ct .0% of permanent, low-yield-rate scenarios on RRRs by future years of eligibility for a 10 Orders/ 7 Among 9 the lower So urincome ces: EB RI/gr Cooup, mmo nw CeD aHP lth Fund en rollees Co nsumer were ism in H neo al tmore h Care Sur likely vey, 200 than 5–2007 those ; EBRwith I/M GAtraditional Co nsumer coverage to report See Chen, Levin, and Gartn all research finding er (2010). s, publications, and news alerts. EBRI also extends its education and public service recommended ? In 2012, 26–40 Brief, no. 344 ( cancer percent of respondents reported some type of scree Emplo nings yee Be were nefit Res lower. earc h Institute, July 2 010). access-to-health-care issue for either themselves or 201 coverage. 2 A March 2012 EBRI Notes $199 annual sub article (VanDerhei, March 201 scription to EBRI Not 2) u es sed and new surve EBRI Issue y results to up Briefs. Change of date the Address: EBRI, Finke, Pfau minimum emplo and Blanchett (2013). yer-contribution rate that would be needed to financially indemnify the employees for • Visit EBRI’s blog, or subscribe to the EBRIef e-letter. assumed Notes article to bdoes e a perman not incen orporate t condition the ,i m assuming pact of investme retirement nt or incom management e/wealth mu fees st cover and us100 es th pree ercent different of simulated Appendix Engagement in Heal 20 th C .0%are Survey, 2008–201 2. simulated for situations where the zero-real-bond-return scenario lasts for either five or 10 years, and then defined contribution plan. Given the relatively short durations remaining until retirement age for the two Baby role to improving Americans’ financial knowledge through its award-winning public service campaign access 11 . T issues estimon in y. U. most or opponent of any position.” S. Cong years 20 of ress. Senate F .0% the 1100 13th St. NW, Suite 878, Washington, survey. iHowever, nance Committ in thee. e hiTax Reform gher income Options: Prom DC, 20005-4051, (202) 659-0670; fax number, group, CDHP otenrol ing Rle ees tirement Security were more likely (T-170), to analysis of the potential impact of various types of tax-reform options on retirement income. family member the a reduction s. Individuals in co in their expected nsumer- retirement driven he income alth plans (CDHPs) and under various rate-of-re high-deductible health plans ( turn assumptions (VanDerhei, HDHPs) were See Haviland, TSood, raditio na McDevitt, l = health plan and with no Marquis deductib(2011). le o r <$ 1,00 0 (individual), <$ 2,000 (family). Subscriptions distributions for real bond ® returns (arithmetic means of 2.6 percent, 0 percent. and –1.4 percent). Similar to retirement expense. However, the impact is significantly reduced at less stringent thresholds. For example, 1 reverts to historical averages. Boomer This 0 study . “Tcohorts, he Impact of PPA on is based this on analy data 10 fsr Re is om .0%is tireme the (202) 775-6312 limited 20 nt Income for 401(k) 05 to -200 just 7 ; e-mail: EB Gen RI/Co Xers. mmonwealt Particip subs Those criptions@ebr ants.” in h the Fun EBRI Issue Brief, first i.o d rg Consum eligibi Membe erism lity no. 318 (Empl rsh clas inip Information: sificati Healthon Care o(zero yee Be Surv Inquiries ynefit e ey arand s of ChoosetoSave and the companion site www.choosetosave.org • EBRI’s reliable health and retirem b ent surveys are just a click away through the topic boxes at report Over There time, are access 15 Sept. 20 also CD March iHP ssues mixed enrol 2006). 11. in fin lees most d ine gs x years peri with ence of resp td hect e a sdecli uto rvey. the ne in impact acce ss of issues, CDHPs HD on HP prescription-dr enrollees did ug not use. ex per One iestudy nce such found a de that cline, VanDerhei and Copeland (2004). HDHP = high-deductible health plan with deductible $ 1 ,000+ (individual), $ 2,000+ (family), no acco unt. 5 12 more likely than individuals with traditional coverage to report access issues 10.0% when their See Fronstin, study only ,80 an percent Sepulveda, a equity premium of sinmulated d Roebuck (2013). of 6 retir percent ement for expen all three ses must return be scenarios covered, is only used. 5–8 percent are projected to run regarding EBRI membership and/or contributions to EBRI-ERF should be directed to EBRI The May 201 c 2 EBRI Notes article (VanDerhei, May 2012) provided 2012 updates for the previously the 2008Rese -20 12 arch Institute, June 2 EBRI/MGA Consumer 008). Engagement in Health Care Survey. They are online surveys of privately insured future eligibility) CDHP experien = co nsumce er-donly riven ha ealsmall th plan w decrease ith deductible $ in 1 ,0th 00+e (inRRR dividuagoing l), $ 2,00 0from + (familythe ), withhistorical acco unt. returns to the zero real CDHP en the top of the page. rollees continued to use brand names and fewer generic drugs in the second year of the program, but the and traditional plan enrollees 0.di 0% d not see longer term declines, but did experience a decline in delaying or avoiding President Dallas 8.6/2.6 first five fir s Salisbur t ten 8.6y /2. at th 6 firs e t fa iv bove e first t address, ( en 8.6/2.6 202) 659-0670; first five first ten e-mail: 8.6/2.6 salisbur first five y@ebri.org first ten 13 1 1 published RRRs as well as the RSS. short . “T of mon he Importanc Later that ye ey. e of De ar, an updated fined Benefit Pl version of the mode ans for Retirement Income A l was developed deqto uac enhance y.” EBRI Notes, the EBRI no. 8 (Emplo interactive yee Benefit ? Individuals * Din iffer households ence between 0. with H 0% DHPless /CDHth P and an $50, Tradit000 in annual i io nal is statistically sn ® ign come were more lik ificant at p = 0.05 o r bettely than er. those in households with To EBRI is sup have a medical ho ported b me, the respo y organizations from all industries and sectors that appreciate the value of ndent must have indicated that he or she had a personal/family doctor; had timely returns adults VanDerhei (September 2006 ag fo es r bonds 21-64, even fielded at in the August ). 100-percent-expense of each year. The th sure rveys shold were (a 6 co percentage-p nducted to proint ovide decrease, nationallyfrom representati 39 percent ve EBRI Retirement Security Projection Model gettin reductio g health ns in gene care ric due dru to g co usst e di betw d 8.not 6/2. een 6 per 26/ 0 s01 0 ist. 11 a 4. CDHP n 6/-d 1.4 2012. 8. enr 6/2.o 6The llees 6/ -overall 09with 4.6/- chr 1.4 peorcentag 8. nic 6/2.con 61 e d 6/0 ition-0of19 C 4.s D 6/- HP did 1.4 e not 8. n6/2. rolle use 6 es 6/ more 20report 0+ 4.dr 6/-ing 1.4 ugs acc than ess ® . “ERISA At 30: ** To havT e a m he Decline edical ho me, of Private the respo nd -Sect ent mus or Defin t have indi ed ca Benefit Prom ted that he o r she h ises an ad a perd Ann so nal/fam uit ily y do Pa ctyme o r; had t nts: W imely hat Will It CDHP Enr Ballpark ollees E$timate by providing Monte Carlo simulations of the replacement rates needed for specific • Need a number? Check out the EBRI Databook on Employee Benefits. Research Institute, August 2011): 7–16. access unbiased, reliable information on emplo $50,000 or more in annual inc to care; had a doctor who 80%knew o18 me to report Lo .5% wes medical t inc 19ome .2% qu history; 19 ar access issues. til .4% e y 13 ha ee b .0% d a provider who knew him or her as a 14 enefits. 2 .3% 15.1% Vis 9.i6% t www.e 113 .0%bri.o 12.2% rg/about/join/ Hi 5.ght 0% pers est in on; and ha 6. co 8% me for more. qua 8. r4% tile d a data regarding the growth of CDHPs and HDHPs and the impact of these plans and consumer engagement more to Results Under a Pe 33 percent). However, rmanent, Low-Yield-Rate Sce as one moves right on the horizontal axis nario with more years of future eligibility (and Editorial Board: acc Dallas L ess to ca.r Salisbur e; had a do y, publisher cto r who kno ; Stephen Blakely ws medical histo,r editor y; had a p . Any ro vi views der whoexpr knew es hi sed in this p m o r her as a pe ublicat rsoion and th n; and had ose o a f the authors should those in other plan designs, although CDHP enrollees used more mail-order drugs than PPO enrollees in all three issues was nearly 50 percent in 2005 and 2006, dropped to 38 percent in 2007, remained between 35 percent and The June 2012 EBRI Notes article (VanDerhei, June 2012) introduced severity categories in the RSS One of the b pro asic babilities objecto ives f retirement- of the RSPM income is adequacy to simulate under the alternativ percentage e-risk- of management the population treatmen that ts will (VanDerhei, be at risk of Not surprisin Meang ?” ly, EBRI Issue Brief, there appears no. 269 (Emp to be a very lo limited yee Benefit Res impact of eaa rch Institute, Ma low-yield-rate y environment 2004). on retirement 80 90% % 24 10.7% .9% 24 11..7% 4% 24 11.5% .7% 17 10..3% 1% 19 11.8% .6% 20 12..9% 3% 10 8..9% 3% 16 10..7% 1% 18 12.8% .3% 5. 5.5% 7% 8. 7.9% 7% 11 9..8% 9% 14 Among CDHP enrollees, employer contributions to the HRA or HSA as well as length of time with the account were not be ascribed to the officers, pro vider who was c trust oo rdinat ees, ing c me am re.bers, or other sponsors of the Employee Benefit Research Institute, the EBRI Education and provider who was coordinating care. 8 hence generally a high on ter he likelihood behavior aof nd more attitudes years of of adu future lts witpar h prtivate icipation health ), th in e surance influence cover of age. a lower interest rate scenario • Instan projecti tly ge ont e-m s for Gen ail noti Xers. ? cations of the latest EBRI data, surveys, publications, and meetings Figure 41 years. perc Th 1 ent ere anal sin September 200 was yzes ce the no the ndi , ffer a imp nd e 6). a by nce ct 90 1020 % of 0% betw 11 perman 13 38 .2% was .6% een 13 do 36 th ent, ..4% 4% e wn CD low-yield 13 to 35 HP .5% .2% 36 a n perc 13 59 d ..2% 8% point-o -rat ent 14 55 e an .8% .5% scen f-servic d 38 14 53 arios ..3% 0% pe e rcent (POS 10 73 on .3% .4% RRRs i) n15 e 68 201 n ..0% 1% roll by 2. ees 16 64 age The .0% .5% in coh dec mail 86 6.3% .1% o line -or rt. 12 81 d in At .er .5% 2% access the use. 15 77historic .8% .5% issues al- in ? Very few differ . “Capping Tax-Preferr ences in access ed Retir issues were found by whet ement Contributions: Prelimi her nar employers y Evidencco e of the Impact ntributed to th of the Nation e account, but access issues al Commission on not having retirement income adequate to cover average expenses and uninsured health care costs (including Research Fund, # or Di their fferenc staffs. e betw Nothin een M ed g her ical e H in is to be co o me and Do es nstr no ued as an attem t have a M edicap l H t to aid or o me is s hi tatnder istical the adoption ly significant aof a t p =n 0 y. pending le 05 o r better.gislation, regulation, income adequacy for those in the lowest- (preretirement) income quartile, given the relatively small level of ® 14 examined. Very few differences in access issues were found between individuals whose employers contributed to the 6 100% 16.4% 16.0% 15.9% 51.1% 43.2% 40.6% 70.3% 58.5% 53.2% 85.5% 75.3% 68.2% increases. More . “Can America Afford informa For texample, ion about the moving To 2012 morrow from EBRI/MGA 's Retirees: Re the historic Consumer su al-re lts F En turn rgageme om the EBRI-ERF assumpti nt in Hon ealth Care Sur to Retireme a zero-rnt Securit v eal-int ey can be ere y Pr st-r foun ojate ection Mo d in Fronstin assumpti del.on ” and seminars by clicking on the “Notify Me” or “RSS” buttons at the top of our home page. return or interpretative assumptions rule, or as (denoted legal, accoas unting, 8.6/2 actuarial, o .6 in the r other such prof figure), 55 essional advice. percent of the Early Boomers are estimated to have 2007 was Fidue scal Res to bot pon h sibil reduc ity a tions nd R in eform Recomme enrollees who ndati repor ons.” ted no EBRI Notes, t filling prescript no. 7 (Emplo ions due yee Be to cost nefit Researc or skipping h Institute, Jul doses to y were found by the level of contribution. long-term-care costs) at age 65 or older throughou Future tYears reti ofrement Eligibilityinin a Def spinecific ed Contribut income ion Planand age groupings. The RSPM defined contribution and IRA assets and the relatively large contribution of Social Security benefits for this account andThe Aug those w uh st 20 ose 12 emEBRI ployers Notes did article not. For (VanDerhei, example, August in 2012, 20 3 12) 8 pprov ercent ided ofadditional individuals evidence whose on emwhethe ployers r did not 2008 The RSPM was significantly enhanced for the May 2008 EBRI policy forum by allowing automatic Another study found that under the CDHP, use of prescription drugs to treat hypertension and cholesterol fell, results (2012). in EBRI Issue Brief, an 11 percentag no. 263 (E e-point mplo decrease yee Be in nef simulate it Resear d cretirement h Institute, Novemb readiness er 200 for3). Gen Xers with one to nine make sufficient me 201 dicati retir 1): 2–6. on ement last lo resour nger,ces and to incover those 100 who percent reportedof delayin the simulated retirement g or avoiding getting expen healths care es. Thi dus e increases to cost. The to also provides information on the distribution of the likely number of years before those at risk run short of ® group. However, there i Source: EBR deferring I Rretirement etirement Security s a very significant to Projection age 70 Model would Versions impact provide 1750, 1755 and 1760. for retireme the top nt income adequacy three income quarti for the vast maj les. ority of Baby enrollment of 401(k) participants with There’s lo the potential ts more! for automatic escalation of contributions to be ® contribut ?EBR Length of time I No e tes to is th ree gister acco with the account had a ed in the U. unt reported S. Patent and T access rn ade issues impa mark Office. ct on access i compar ISSN: ed 1085 with ssues, with 2012 ? 445 37 2 1085 percent ?4452/9 amon being the first 0 $ . g in 50+. divid 50u year where it als whose emwas found that ployers did Source: EBRI Retirement Security Projection Model Versions 1750 and 1762. whereas there was no change for asthma, depression, or ulcer medications. The study found that 17 percent of the years of futur Return e eligibility, assumptions are presented as and a 15 arithmetic means percentage-p for equities oint and bonds as d thecrease real returns. Inv for th estment ex ose with penses are 10 not or incorpo more rated year in this s version of the of future 57 percent for the Late Boomers and Gen Xers, whose projected retirements occur later. percentageR re eturn porting assumptionthat s are presented as they did arithmet not ic means fill prescript for equities and ions bonds due as to real cost returns. Inv or estment ex skippe penses are d doses not tincorpo o make rated in me this dic version of the ation last longer 1100 13 Street NW · Suite 878 model. more years model. with the account were more likely to be associated with access issues. Washington, DC 20005 Visit EBRI on-line today: www.ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org No No No No No No No No No No No No No Notttttttttttttte e e e e e e e e e e e e es s s s s s s s s s s s s s • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vo • June 2013 • Vol. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 l. 34, No. 6 13 11 15 14 20 12 10 18 2 9 8 3 6 4 (202) 659-0670 www.ebri.org © 2013, Employee Benefit Research Institute ?Education and Research Fund. All rights reserved. www.choosetosave.org A monthl y newsletter from the EBRI Education and Research Fund © 2013 Employee Benefit Research Institute ebri.org Notes • June 2013 • Vol. 34, No. 6 ebri.org Notes • June 2013 • Vol. 34, No. 6 ebri.org Notes • June 2013 • Vol. 34, No. 6 ebri.org Notes • June 2013 • Vol. 34, No. 6 ebri.org Notes • June 2013 • Vol. 34, No. 6 17 16 19 5 7 Figure 3 Access Issues, by Type of Health Plan and Household Income, 2005–2012 Figure 5 Less Than $50,000 Yearly Household Income $50,000 or More Yearly Household Income a 2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012 Access Issues Among Individuals With CDHP, by Level of Employer Contribution to Account, 2006–2012 a Traditional 2006 2007 2008 2009 2010 2011 2012 Not filled a prescription due to cost or skipped Employer Contribution Below $1,000 doses to make medication last longer 31 29 33 28 29 30 32 33 18 19 18 17 21^ 20 20 17^ Not filled a prescription due to cost or skipped doses to make medication last longer 29 24^ 23 31^ 26^ 25 25 Delayed or avoided getting health care due to cost 24 29 26 35^ 18^ 18 27^ 24 13 14 12^ 16^ 14 10^ 15^ 12^ Delayed or avoided getting health care due to cost 37 30^ 27 22^ 23 23 22 Either of the above 39 42 41 47^ 36^ 38 41 39 24 25 23 26^ 27 24^ 27^ 23^ Either of the above 48 40^ 36 41^ 37 38 37 b HDHP Employer Contribution $1,000 or More Not filled a prescription due to cost or skipped Not filled a prescription due to cost or skipped doses to make medication last longer 32 25 25 33^ 35* 26^ 32*^ doses to make medication last longer 38 31 36 35 33 31 38^ 30^ 30 27* 27 28* 27* 27* 28* 25* Delayed or avoided getting health care due to cost 39 26^ 27 22 25 20 32*^ Delayed or avoided getting health care due to cost Either of the above 41 36 40 37 39* 33*^ 36* 34* 28* 30* 29 28* 25* 24* 22* 24* 51 34^ 36 40 42 33*^ 41^ Either of the above 53 48 53 51 50* 46 53*^ 46*^ 40 41* 40 40* 38* 38* 37* 39* Sources: EBRI/Commonwealth Fund Consumerism in Health Care Survey, 2005–2007; EBRI/MGA Consumer Engagement in Health Care Survey, 2008–2012. a c CDHP = consumer-driven health plan with deductible $1,000+ (individual), $2,000+ (family), with account. CDHP * Difference between Employer Contribution Below $1,000 and Employer Contribution $1,000 or More is statistically significant at p = 0.05 or better. Not filled a prescription due to cost or skipped ^ Estimate is statistically different from the prior year shown at the p = 0.05 or better. doses to make medication last longer 36 33 32 28 35 28 32 29 28 29* 22^ 22 31*^ 29* 24^ 27* Delayed or avoided getting health care due to cost 49* 40 34 33 38* 30 33 30 31* 37* 29^ 25* 20* 23* 20* 24*^ Either of the above 56 53 48 45 50* 44 48 43 45 47* 36^ 33 40* 38* 34*^ 36* Sources: EBRI/Commonwealth Fund Consumerism in Health Care Survey, 2005–2007; EBRI/MGA Consumer Engagement in Health Care Survey, 2008–2012. a Traditional = health plan with no deductible or <$1,000 (individual), <$2,000 (family). b Figure 6 HDHP = high-deductible health plan with deductible $1,000+ (individual), $2,000+ (family), no account. a c CDHP = consumer-driven health plan with deductible $1,000+ (individual), $2,000+ (family), with account. Access Issues Among Individuals with CDHP, by Length of Time WIth Account, 2006–2012 * Difference between HDHP/CDHP and Traditional is statistically significant at p = 0.05 or better. 2006 2007 2008 2009 2010 2011 2012 ^ Estimate is statistically different from the prior year shown at the p = 0.05 or better. Had Account <1 Year Not filled a prescription due to cost or skipped doses to make medication last longer 28 27 25 33^ 30 27 21^ Delayed or avoided getting health care due to cost 38 26^ 29 20^ 26 28 22^ Either of the above 48 38^ 38 42 39 42 33^ Figure 4 Had Account 1–2 Years a Access Issues Among Individuals With CDHP, by Employer Contribution to Account, 2006–2012 Not filled a prescription due to cost or skipped doses to make medication last longer 35* 24^ 23 29^ 27 24 26 Delayed or avoided getting health care due to cost 2006 2007 42 2030^ 08 2009 24*^ 2010 22 2011 22 2012 19* 25^ Either of the above 54 41^ 35^ 40^ 39 33* 38 Employer Contributes to Account Had Account 3 or More Years Not filled a prescription due to cost or skipped doses to make medication last longer 35 28^ 23^ 32^ 31 26^ 29 Not filled a prescription due to cost or skipped doses to make medication last longer 28 20& 20 32^ 29 24^ 31&#^ Delayed or avoided getting health care due to cost Delayed or avoided getting health care due to cost 41 29^ 26 20^ 23 20 26^ 33 33 24^ 23 23 18&^ 27&^ Either of the above Either of the above 53 38^ 43 35 36 40 32& 39 39^ 34^ 37 32& 37 40&^ Sources: EBRI/Commonwealth Fund Consumerism in Health Care Survey, 2005-2007; EBRI/MGA Consumer Engagement in Health Care Surve Employer Does Not Contribute to Account y, 2008-2012. a CDHP = consumer-driven health plan with deductible $1,000+ (individual), $2,000+ (family), with account. Not filled a prescription due to cost or skipped doses to make * Difference between Had Account < 1 Year and Had Account 1-2 Years is statistically significant at p = 0.05 or better. medication last longer 26* 28 26 36^ 27^ 26 24* & Difference between Had Account < 1 Year and Had Account 3+ Years is statistically significant at p = 0.05 or better. Delayed or avoided getting health care due to cost 37 32 23^ 24 23 24* 23 # Difference between Had Account 1-2 Years and Had Account 3+ Years is statistically significant at p = 0.05 or better. Either of the above 47 44* 34^ 43^ 38 41* 38 ^ Estimate is statistically different from the prior year shown at the p = 0.05 or better. Sources: EBRI/Commonwealth Fund Consumerism in Health Care Survey, 2006–2007; EBRI/M GA Co nsumer Engagement in Health Care Survey, 2008–2012. a CDHP = consumer-driven health plan with deductible $1 ,000+ (individual), $2,000+ (family), with acco unt. * Difference between Employer Co ntributes to Account and Employer Does Not Contribute to Account is statistically significant at p = 0.05 o r better. ^ Estimate is statistically different from the prior year shown at the p = 0.05 or better.