Too sick to work, too healthy to qualify: a cross-country analysis of the effect of changes to disability benefits

BackgroundDenmark and Sweden have implemented reforms that narrowed disability benefit eligibility criteria. Such reforms in combination with increasing work demands create a pincer movement where in particular those with moderate health problems might be unable to comply with work demands, but still not qualify for permanent disability benefits, ending up with temporary means-tested or no benefits. This paper examines whether this actually happened before and after the reforms.MethodsThe Survey of Health, Ageing and Retirement in Europe (SHARE) study waves 1–2 and 4–6 in Denmark and Sweden for the age group 50–59 years (N=5384) was used to analyse changes in employment rates and benefits among people with different levels of health before, during and after disability benefit reforms. Interaction between time and health in relation to employment versus permanent or temporary benefits was used as a criterion for whether our hypotheses was confirmed.ResultsOverall, employment rates have increased in the age group, but only among the healthy. The OR for receiving temporary or no benefits increased from 1.25 (95% CI: 0.81 to 1.90) before to 1.73 (95% CI: 1.14 to 2.61) after policy reforms for the 29% with moderate health problems and from 2.89 (95% CI: 1.66 to 5.03) to 6.71 (95% CI: 3.94 to 11.42) among the 11% with severe health problems. The interaction between time and health was statistically significant (p