Description: This actuarial memorandum represents the first, formal actuarial opinion regarding the reasonableness of the premium estimates the Clinton Administration presented with its proposed Health Security Act. The memorandum presents the assumptions and methods used to develop an average 1994 premium estimate for the standard benefit package.

Description: This paper solves the pension benefit allocation problem using an extremely simple accounting approach. It presents a simple accounting argument, which says that the cost for like units of production should increase at the rate of inflation. If we assume that the appropriate units of production for an employee are inflation-adjusted salary, this rationale leads to projected unit credit with the benefit apportioned by interest-adjusted salary [PUCIAS] as the appropriate funding method for pensions. This same rationale can be extended to post-service medical care funding. For post-service medical care, however, the rationale does not lead to PUCIAS, since the rates of inflation for medical care and salary do not cancel. There is also a question whether inflation-adjusted salary should be used as the units of production for post-service medical care. When it is, it is still important avoid aggregating groups with different salary and promotion patterns. When it is not, the widget accounting arguments still hold as far unit costs increasing with the rate of medical care inflation.

Description: Abstract from a paper that describes results from a hierarchical Bayesian statistical model which predicts the probability of Non-Acceptable Claim, an unnecessary hospital stay, using hospital discharge claim records as inputs.

Description: This paper suggests that many problems in health insurance pricing can be solved by requiring a minimum mandatory paid-up period [i.e., premium period shorter than insurance period], and by encouraging insureds to persist by providing them adequate pricing information. This will generate significant investment income for insuring programs and reduce the cost of insurance.

Description: In this paper the authors analyze data from group medical expense insurance claims and show that many insurance loss distributions have very 'heavy tails' because large losses represent a disproportionate fraction of the total cost. They also present a simple model to reproduce and explain the large loss behavior. From Actuarial Research Clearing House 1990, VOL. 2

Description: This Fellowship credit research paper describes the use of fuzzy sets applications to the selection of group health risks. In general, fuzzy set theory is implemented to describe collections of objects whose boundaries are not precisely defined, as in the judgment of what constitutes a good risk group. First, single-plan underwriting is considered, then the work is extended to multiple-option plans.

Description: There is growing evidence of a positive correlation between income levels and longevity. In short, high-income earners live longer. That also means that high-income earners get larger retirement-income security benefits from Social Security. This correlation raises a number of questions: if Social Security contributions are a level percentage of earnings, and high-income earners live longer and receive larger Social Security benefits, then is Social Security regressive? If higher-income actually causes enhanced longevity, then would providing more Social Security benefits enhance population life expectancy? This paper analyzes both the OASDI system of the United States and the Canada/Quebec Pension Plans in Canada to see if these systems are 'a good deal' and whether they are regressive or progressive as defined above. From Actuarial Research Clearing House 1998 Vol. 1.

Description: This article discusses some 'standard' methods of foreign expansions. Strategic decisions for expansion in foreign countries require more than qualitative discussions about foreign expansion. It requires hard numbers on the benefits of such strategic expansion plans and is illustrated here with the example of MetLife's 2002 purchase of Ahisa [Aseguradora Hidalgo]. With that purchase, more than 70% of the Mexican insurance market is in the hand of foreign companies.

Description: This paper is the final report in a project commissioned by the Society of Actuaries Social Security Committee. The paper considers a variety of possible risk classification factors that could be used in estimating the value of any mortality based benefit for retirees. As many countries consider mandatory individual retirement accounts as their answer to a secure Social Security system, the question arises as to whether all workers can get true 'market value' annuities when they retire. It is clear today that private sector life annuities are priced assuming that the applicant is healthy-very healthy. Very little underwriting or risk classification now exists in the individual annuity marketplace. This paper reviews 45 recent research papers that look at factors that affect mortality after retirement. In particular, factors that seem to be important in predicting retirement mortality include: age, gender, race and ethnicity, education, income, occupation, marital status, religion, health behaviors, smoking, alcohol, and obesity. For each factor, this paper gives highlights relative to the named factor of the impact expected from that variable as described in the 45 reviewed research papers.