What is job-lock? Essentially the term means that an individual is locked into a job and cannot change jobs without catastrophic financial consequence. Ironically, the financial consequences are not a result of losing job income, but a result of losing job health insurance.
Job-lock and Health Insurance
For instance, if an individual is diagnosed with a malady that requires costly treatment, the expense can reach millions of dollars. How can a family or individual pay these huge medical bills? Most cannot afford to pay for expensive healthcare without the financial assistance provided by an insurer.
Often, the workplace provides the necessary coverage for healthcare expenses with a company group insurance plan. Without such health insurance, many individuals could not afford sufficient food, housing, clothing, and other necessities because all of their income would go to medical expenses. These individuals are “locked” to the health insurance provided by their jobs.
Reforming Healthcare to end Job-lock
Although the Health Insurance Portability and Accountability Act (HIPAA) is a safeguard against job-lock, HIPAA has limitations and is not a guarantee that benefits or coverage from one healthcare program will be transferred to the next. Thus, HIPAA is not the solution, and the elimination of so-called “job-lock” remains an objective in reforming healthcare.
Journalist Liz Wolgemuth of U.S. News World Weekly, reports that reform “could make it easier for workers to leave employers to whom they are ‘job-locked,’…a situation more common to older workers and those with pre-existing conditions.” And as Wolgemuth’s article continues, she discusses how reformation of the healthcare system could affect employment of older workers.
Wolgemuth quotes economist Dave Autor who states, “One of the long-standing barriers to hiring elderly workers is healthcare costs.” With the barrier removed and the cost of healthcare reduced for some companies, older workers might expand their job searches. Healthcare reformation, however, is still being debated and, “it's unclear what precise shape healthcare reform will take” (Wolgemuth). Nonetheless, with the increasing age of the United States population and the increase in individuals aged 60 and over, healthcare reforms will necessarily affect the workforce and the senior population.
Worldwide Effect of Aging
A press release from the National Census Bureau warns that “Population aging has and will have large effects on social entitlement programs, labor supply, and total savings around the globe.” The National Institute of Aging emphasizes this point in the report Why Population Aging Matters stating, “Since the beginning of recorded human history, young children have outnumbered older people. Very soon this will change. For the first time in history, people age 65 and over will outnumber children under age 5” (p.2), and according to the report this prediction applies worldwide
Aging and Healthcare Reform
How does this trend affect healthcare? Stated simply- if healthcare is not reformed and structured to accommodate the forecasted increase in the aging population now, the aging population will force a change in healthcare later. The foreword of the publication Why Population Aging Matters refers to the dilemma of the shift in population and warns that delays in coping with this expected increase of people aged 60 and over will only make finding solutions more costly and complicated later.
As for the direct impact of aging on the healthcare industry, a study called The Global Burden of Disease “predicts a very large increase in disability caused by increases in age-related chronic disease” all over the world (Foreword of Why Population Aging Matters ).
And the Morbidity and Mortality Weekly Report published by the Center for Disease Control adds that “The anticipated increase in the number of older persons will have dramatic consequences for public health, the health-care financing and delivery systems, informal caregiving, and pension systems" (2003). Age-related disabilities will have a tremendous impact on the healthcare industry.
According to Liz Wolgemuth, the strategy that is currently practiced by many ailing workers (especially those with low income) is to continue working until age 65 at which time they qualify for Medicare; the ailing worker will then transfer his/her health insurance coverage to Medicare. With the projected increase in the number of individuals aged 60 and over and the associated increase in age-related disability, everyone needs to be concerned with avoiding a healthcare crisis.
The recommendation of the National Institute of Aging is the development of programs and policies that anticipate the population shift. Programs that are developed after problems have developed are more costly and complicated than preemptive plans. According to projections from studies such as the "Global Burden of Disease," increased reliance on healthcare by an aging population is inevitable; furthermore, the make-up of the work force is affected by job-lock and employees' reliance on healthcare insurance.
Although many policymakers agree that a reform of healthcare is necessary, as journalist Liz Wolgemuth has noted, "it's unclear what precise shape healthcare reform will take." As of October 2009, more debate than actual progress has occurred, and the "precise shape" of healthcare reform is still undetermined.
References
A global perspective why population aging matters. (2007). National Institute on Aging. U.S. Department of Health and Human Services. U.S. Department of State.
Kinsella, K., Wan, H. (2008) An aging world: 2008, international population reports. U.S. Census Bureau. U.S. Department of Health and Human Services. National Institute on Aging. Issued June 2009.
Public Health and Aging: Trends in Aging --- United States and Worldwide. (2003). Morbidity and Mortality Weekly Report. 52(06);101-106.
Unprecedented Global Aging Examined in New Census Bureau Report Commissioned by the National Institute on Aging. U.S. Census Bureau Newsroom Release. (2009). Census.gov
Wolgemuth, L. (2009). How healthcare reform could get you hired. U.S. News World Weekly. Oct. 5 Issue.
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