Continuing Care Actuaries will gather information regarding the member contracts, membership and monthly fee schedules, and financial data about the operation of your program. We will develop population and economic assumptions that reflect your programs mission statement, management style, and anticipated member demographic characteristics. The actuarial assumptions required to evaluate the long-term financial status of an At-Home program are separated into four categories: (1) decrement assumptions; (2) new membership assumptions; (3) operating assumptions; and (4) economic assumptions.
- Decrement Assumptions are used to estimate the survival of residents, as well as their future living status over time. Decrement assumptions include mortality rates, morbidity rates (i.e. rates of health care utilization), transfer rates between different health statuses and withdrawal rates.
- New Membership Assumptions are used to estimate the characteristics of future members in your program. They include the distribution of membership ages, the probability that specific homes will be occupied by a single member versus two or more members and the gender of single and paired members.
- Operating Assumptions are drawn from the Member Agreement and from anticipated management policies and practices including the amount of health care promised, the criteria for transfer, the financial implications of transfers and the personnel costs of providing services to members.
- Economic Assumptions are used to estimate the program’s future expenses and revenues, including rates of inflation, debt service costs and interest earnings on any invested funds.
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