Health Policy Center Authors

Publications by Christopher Murtaugh for Health Policy Center

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This study explores the properties of an integrated income and disability annuity as an alternative framework for long-term care financing, demonstrating that pooling disability and mortality risks can reduce the need for medical underwriting, and discussing private and public implications. Specifically, a simulation indicates that pooling these competing risks can reduce the costs of both the income annuity and the disability coverage and expand the medically eligible population to 98 percent of 65-year-olds. Combining income and disability protection may be able to expand private markets for long-term care financing beyond what appears possible in the conventional long-term care insurance market, and is only one of multiple models that could be considered for long-term care financing. Public policy should foster innovation in financing mechanisms and avoid the distortion of choices created by exclusive policy focus on a conventional insurance model. (Journal of Aging and Health 15(1): 45–73, 2003.)

This study explores the properties of a combined income and disability annuity in the context of the current long term care and retirement environment, particularly the trend toward defined contribution pensions and reduced annuity offerings through pension plans. Current tax policy obstacles to such a combined product and potential remedies for them are discussed. (In Innovations in Financing Retirement 2002; edited by Olivia Mitchell, Zvi Bodie, Brett Hammond, Stephen Zeldes; University of Pennsylvania Press).

This article examines the implications of the positive correlation of mortality and disability for the benefits of combining an immediate income annuity with long-term care disability coverage at retirement ages. It also investigates the value of such a combined benefit to various subgroups of prospective purchasers and the implications of possible errors and moral hazard in the reporting of disability status and making claims. (The Journal of Risk and Insurance, 2001, Vol. 68, No. 2, 225-254)

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