This paper presents an approach that assesses the role of early life and contemporaneous macroconditions in explaining health at older ages. In particular, we investigate the role of exposure to diseases and economic conditions during infancy and childhood, as well as the effect of current health care facilities. Specific attention is paid to the impact of unobserved heterogeneity, selective attrition, and omitted relevant macrovariables. We apply our approach to self-reports on functional limitations of Dutch older individuals. The prevalence of functional limitations is found to increase in the 1990s, in part due to restricted access to hospital care. © The Author(s) 2008.