Chairperson's Corner
By Kevin Francis
Health Watch, January 2023
My two years supporting the Health Section have been times of change for our profession. The continued pandemic activity has changed how we look at data, modeling and forecasting—basically, every actuarial tool we have in our kit. I have continued to marvel at our profession’s resiliency to continue to thrive in these times. It is our section’s honor to serve such a professional and high-performing group of individuals. Give yourself a pat on the back on my behalf!
Our goal is to meet your high level of performance. To that end, we have worked side-by-side with you over the past year to expand the resources for our profession. One of the innovations the health actuarial community has brought to the section is a new breadth of engagement opportunities. We are releasing work digitally, hosting webcasts, recording podcasts and bringing top-notch content to in-person meetings. One of my top goals as chairperson as we move through the next year is to enhance our engagement with you even further. To that end, look for increased opportunities to interact with your health actuarial peers across several modalities.
The Health Section worked diligently to advance our research agenda. The following is a summary of published health research work since 2021:
| Research Title |
Date Published |
Author(s) |
Summary of Research |
|
January 2021 |
Geof Hileman, FSA, MAAA |
This study uses health care encounter data to simulate the choices faced by health insurance shoppers under a variety of conditions and measures the simulated effect of increased consumer choice and consumer information on medical loss ratios and, as a consequence, insurer profitability. |
|
|
An Actuarial Perspective on the Relationship of Patient Centered Medical Homes and Healthcare Costs |
March 2021 |
Susan Pantely, FSA, MAAA |
This paper helps the audience understand the actuary’s role in estimating the financial impact of primary care programs. In addition, the paper can be used by actuaries to think about key issues when estimating the financial impact of their employers’ and clients’ own primary care programs. |
|
Health Care Cost Model (Projecting Health Care Costs During COVID-19) |
January 2022 |
R. Dale Hall, FSA, MAAA, CERA, CFA |
The Society of Actuaries (SOA) created the SOA 2022 Health Care Cost Model (model) to enable users to estimate future US health care insurance costs. This model allows a user to consider a variety of scenarios and create inputs that can forecast the impact on the health care service system. The model will be updated periodically to reflect the latest data on both the outbreak and insurance health care costs. A user guide, user training video and model documentation guide have also been developed to support the model. |
|
“Uninsured Rate” Measurements and Health Policy Considerations |
September 2021 |
Gregory G. Fann, FSA, FCA, MAAA |
The Patient Protection and Affordable Care Act (ACA) was multifaceted, but its primary purpose was to reduce the number of uninsured Americans. This report examines the various publications reporting on the uninsured rate, which stakeholders frequently access to measure policy efficacy and inform future policy considerations. |
|
November 2021 |
Marjorie Rosenberg, PhD, FSA |
This report explores the impact of clustering using the Medical Expenditure Panel Study (MEPS) data for children (aged 5 to 17) to build a bridge between oral health and overall health using dental and medical expenditures. It includes social determinants of health as cluster input variables using the Partitioning Around Medoids (PAM) method to identify children and their families who could potentially benefit from population health management related to oral health. |
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|
Getzen Model of Long-Run Medical Cost Trends Update for 2022–2030+ |
November 2021 |
Thomas Getzen, PhD |
COVID has washed over health care like a tsunami. According to Medicare actuaries, trends have been turned upside down in 2021 but will reverse in 2023 as medical costs rebound. This model projects long-run trends for health care as well as general economic projections. |
|
A Two-Part Model of the Individual Costs of Chronic Kidney Disease |
December 2021 |
Brian Hartman, ASA, PhD |
Chronic kidney disease (CKD) affects many lives and has a large impact on health systems around the world. To better understand and predict costs for insurance plan members with CKD in the United States, the researchers built a new model of their individual costs. This model is the first to explicitly model both the CKD stage transition process and the distribution of costs given those stages. |
|
March 2022 |
Joan C. Barrett, FSA, MAAA |
This research considers the question through the lens of social determinants of health (SDOH), which are factors relating to where you live or work that may impact your health. In the United States, geographical differences in SDOH contribute to wide disparities in health status and outcomes. In particular, individuals who are negatively affected by SDOH may have an increased burden of disease, leading to a relatively high total cost of care and worse quality of life. |
|
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May 2022 |
Achilles Natsis, FSA, MAAA |
On March 22, 2022, the Wall Street Journal hosted its annual Health Forum, a virtual all-day event that included several sessions. This session was attended by experts across the health care space, and attendees included many from the health care technology companies. This report summarizes the event. |
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June 2022 |
Mardo Atoyan, MBA |
This research project offers guidance and a model for actuaries to use when performing their professional services related to Medicaid (Title XIX) and Children’s Health Insurance Program (CHIP or Title XXI) managed care capitation rate setting. The model is intended to be used in the development of comprehensive medical rates for Medicaid Managed Care (MMC). In addition, the authors have created a document to help guide the users through the concept of Medicaid underwriting margin as well as how the model itself works. |
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|
Interactions of Health Care Rating Factors with Race, Ethnicity and Socioeconomic Factors |
July 2022 |
Lydia Tolman, FSA, MAAA |
The Patient Protection and Affordable Care Act (ACA) largely eliminated most health insurance rating practices because they were determined as inequitable. However, several other factors remain as differentiators in premium rates charged to individuals and groups. This research looks to determine if there could be unintended factors, like race, ethnicity or socioeconomic status, that are inherently included in remaining ACA allowable factors, which are: tobacco usage, geographic area and industry. If rating factors are indicative of claims costs, the study results indicate the costs of health care in the region studied could be greater in the areas where some socioeconomic and demographic groups are more likely to live. |
Based on feedback from this community, we have a number of stellar research projects in-flight. Topics to be addressed include social, physical and cultural determinants of health; long-term effects of COVID-19; digital health cost and utilization trends; and an examination of risk adjustment in Medicare Advantage. Additional research projects in pharmacy, behavioral health, health equity and technology solutions for actuaries are in the works as well.
I’d like to express my gratitude to section members Doug Norris, Craig Kalman, Wendy Kwan and Sudha Shenoy. The level of actuarial acumen they brought to the section and their tireless commitment to furthering the section’s research, communications and engagement with the health actuarial community are peerless. Thanks to each of them for their service! We also have the privilege of partnering with SOA staff members Achilles Nastis and Dee Berger. Achilles, Dee and their SOA team members have facilitated a top-notch book of research work and member engagement with our section. Thank you!
I’ll close with my continued gratitude to each of you. My fellow children of the 80s will remember the line from an old song: “When the going gets tough, the tough get going.” All of you have shown your resilience time and again. It’s our honor on the Health Section to work beside you!
Statements of fact and opinions expressed herein are those of the individual authors and are not necessarily those of the Society of Actuaries, the editors, or the respective authors’ employers.
Kevin Francis, FSA, MAAA, is chief actuary of Triple Aim Partners. Kevin can be reached at kevin@tripleaim.com.