This month the Academy premiered the Actuarial Standards Board’s enhanced website, which features a clean, contemporary look; interactive features to access the actuarial standards of practice (ASOPs), exposure drafts, and discussion drafts; and is designed to be accessible on mobile devices.

All of the content from the ASB’s previous site has been transferred to the enhanced site. From the homepage, users can quickly access important documents under the “Quick Links” header; all other documents are accessible via the menu at the top of the screen.

Academy Presents to the NAIC

Academy President Mary D. Miller presented at an event hosted by the NAIC’s Center for Insurance Policy and Research on “The Risk of Pandemics to the Insurance Industry,” as part of the NAIC’s Spring 2015 National Meeting in Phoenix. She discussed the property and casualty lines of insurance that may be affected by an outbreak of disease or bioterrorism, and examined the challenges in modeling due to the limited data with which to develop infection and fatality rates.

Separately, Keith Passwater, chairperson of the Committee on Qualifications (COQ), presented to the NAIC Life Actuarial (A) Task Force (LATF), in response to the task force’s request for assistance with the question of certification for actuarial responsibility in principle-based reserving (PBR), and of continuing education (CE) requirements for PBR actuaries. The COQ carefully considered the U.S. Qualification Standards, and determined that those standards already address PBR qualifications, albeit in a generalized manner. The COQ report also cites reference materials to aid actuaries in keeping up with CE related to PBR.

Among the many other initiatives Academy volunteers engaged in at the Phoenix NAIC meeting:

• Academy Life Practice Council Vice President Mary Bahna-Nolan reported to LATF on the ongoing work of The American Academy of Actuaries and Society of Actuaries Joint Project Oversight Group to finalize the 2014 VBT Basic and Relative Risk tables. She also discussed the group’s efforts to put together the 2017 CSO tables and develop PBR margins, both of which are near completion. Separately, the Nonforfeiture Modernization Work Group presented an update on the group’s activities to LATF. The work group has continued work related to the conditions around cash surrender values.
• The State Long-Term Care Task Force provided an update to the NAIC’s Long-Term Care Actuarial (B) Working Group on three Academy LTC-related projects: long-term care terminations, credibility, and principle-based reserving. Chairperson Warren Jones gave an update on progress to date and goals for completion of the three projects.

Slides and related materials from the presentations have been posted to the “Reports to the NAIC” page on the Academy’s website. A full report on the significant developments from the meeting, which concludes early next week, will be forthcoming in an Academy Alert.

Alerts

• U.S. House and Senate pass budget resolutions, reconciliation process to follow: The U.S. House of Representatives and the Senate have passed budget plans this week that provide for repeal of the Affordable Care Act (ACA) and contain certain policy positions in other areas such as Social Security, Medicaid, and Medicare. Read the full alert here or in the member section under “Cross-Practice Alerts.”
• U.S. House overhauls Medicare payment system: The U.S. House of Representatives on Thursday overwhelmingly passed bipartisan legislation, the Medicare Access and CHIP Reauthorization Act (MACRA), to eliminate Medicare’s sustainable growth rate (SGR) formula and set up a new payment system, as well as reauthorize the Children’s Health Insurance Program (CHIP) for two years. Read the full alert here or in the member section under “Health Alerts.”

Public Policy Activities

• The Academy Risk Management and Financial Reporting Council’s Financial Regulatory Task Force sent comments to the Financial Stability Oversight Council (FSOC) on the effects of insurance asset management products and activities on U.S. financial stability.

Professionalism Activities

• Academy continues its professionalism outreach. During the 15th annual Intercompany Long Term Care Insurance Conference in Colorado Springs, Colo., the Academy’s assistant general counsel, Sheila Kalkunte, led a robust three-hour professionalism session for an audience of 150 long-term care actuaries. The discussion included the latest qualification issues being addressed by the Academy at the request of regulators at the NAIC, and included several case studies and discussion of the implications of the Code of Professional Conduct.

News From the ABCD

• ABCD Annual Report released. Chock full of important information, the Actuarial Board for Counseling and Discipline (ABCD) has just published its 2014 Annual Report. Of note, the number of requests for guidance hit a record high of 90, which suggests that actuaries are growing more willing to turn to the ABCD for guidance. The ABCD views this rise as a positive development, in part because it indicates a greater awareness by the profession of its responsibilities under the Code of Professional Conduct, and potentially helps to avoid violations.

News From the ASB

• ASB welcomes new member. Darryl Knapp, executive director for advisory services at Ernst & Young, has been appointed to the Actuarial Standards Board. Knapp has more than 25 years of experience in commercial group insurance and managed health care. In his service to the Academy, he has served on the Board of Directors, chaired the Health Practice Financial Reporting Committee, and currently acts as vice chairperson for the Financial Reporting Committee of the Risk Management and Financial Reporting Council. Knapp was instrumental in leading Academy work in the development of the NAIC’s risk-based capital formula for health organizations.

  Academy President Mary D. Miller announced the appointment after a meeting of the Selection Committee, for which she serves as chairperson. Knapp’s appointment follows the untimely passing of ASB member Michael Stephen Abroe, who served the Academy for more than 20 years. The ASB looks forward to working with Knapp.

Upcoming Events

• Register now: This year, as Social Security turns 80, both Medicare and the Older Americans Act turn 50, and the 6th White House Conference on Aging is convened, the issues of an aging population are in the spotlight. Join us on April 8 for an Academy Capitol Forum webinar on the topic. Leslie Fried, senior director for the National Council on Aging’s (NCOA) Center for Benefits Access, will offer an overview of the NCOA, discuss the importance of focusing on policy issues that have implications for an aging population, and highlight some of the work the NCOA is doing on issues ranging from long-term care to economic security to benefits access.
• Save the date. The Life Practice Council will hold a post-NAIC webinar on April 17 from noon to 1:30 p.m. EDT. Moderator Dave Neve, chairperson of the Academy Life Reserves Work Group, will lead a discussion of topics covered at the Spring NAIC meeting. Speakers will include Mike Boerner, chair of the NAIC’s Life Actuarial (A) Task Force, and Mark Birdsall, chair of the NAIC’s Life Risk-Based Capital (E) Working Group.

Recent Events

• Pension funding webinar attracts wide audience. The Academy hosted a webinar on March 25 on the underfunding of state and local pension plans and the factors that help explain that underfunding. The webinar, “How Did State & Local Pension Plans Become Underfunded?” was the latest in the Academy Capitol Forum webinar series and attracted more than 400 attendees. The webinar’s guest speaker, Jean-Pierre Aubry, assistant director of state and local research at the Center for Retirement Research (CRR) at Boston College, provided data that showed the two major stock market drops during this century coupled with increased pension costs were mainly responsible for public plans becoming underfunded.

  Don Fuerst, the Academy’s senior pension fellow, moderated the webinar. Fuerst discussed related Academy work products including “The 80% Pension Funding Standard Myth” issue brief, which states that pension plans should have a target of being fully funded, not 80 percent as some have suggested as a standard.

Final Reminder

• Volunteer action required: Committing on an annual basis to professional objectivity is required to perform volunteer work for the Academy. If you are an Academy volunteer and haven’t done so yet, please submit your conflict of interest (COI) acknowledgement and continuing education (CE) attestation by following the instructions in the email reminder you received from the Academy or under the “COI and CE Acknowledgement” section of the membership page (log in here). Failure to submit will result in being dropped from committee membership(s).

Surprise an Exceptional Colleague or Mentor

• As this is the Academy’s 50th anniversary, now is an exceptional time to recognize an Academy member for his or her service to our profession and public service. Each year the Academy honors members who devote themselves to the actuarial profession through their public service and volunteer efforts with our Robert J. Myers Public Service Award and Jarvis Farley Service Award, respectively. The awards will be presented at the Academy’s 50th anniversary celebration in November.

  All members are invited to nominate Academy members for these, and also for our Outstanding Volunteerism Awards. Help us recognize those who have given so much to the profession today—learn more and submit your nomination(s) now.

Academy in the News

• Senior Pension Fellow Don Fuerst provided comments to Pensions & Investments for a story on multiemployer pension reform options to allow plan designers greater flexibility to balance benefits and assets. “[A variable benefit model is] an ideal design for a multiemployer plan because they don’t have the same dependable source of revenue that single employers do. Trustees need the ability to adjust benefits if circumstances warrant. We will have another recession, so it’s very important to remember that,” said Fuerst.
• The Washington Examiner cited the Academy’s issue brief “Potential Implications of the Small Group Definition Expanding to Employers with 51-100 Employees” in a story announcing that seven U.S. senators have asked the Department of Health and Human Services to delay the Affordable Care Act’s (ACA) small group redefinition provision scheduled to take effect in 2016.

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