Offering retiree health insurance to public-sector employees can actually save their employers money in the long run and has a major impact on whether workers stay in the workforce until age 65 or decide to retire earlier.

That’s according to a report by the National Bureau of Economic Research that studied the behavior of public school employees in Illinois to see how responsive they would be to the introduction of a retiree health insurance program. The findings have major implications for government budgets that have been overloaded with debt associated with pension benefits and retiree health care costs.

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