Computer Actuarial Assessment Model: An Executive Overview

Tuesday, Jul 21 321

Why we need it. What it does. How it works.

Current Status. CA2M: Why we need it

When it comes to health care, it is clear that the American people do not believe their elected officials, insurance companies and medical providers have figured out how to deliver the affordable, accessible, quality care they want and/or need. Their dissatisfaction has made health care a major, if not the major issue, in national and local elections for more than a decade and it is now clear it will play a major role role in the up-coming 2020 campaigns as well. The public frustration and irritation is, unfortunately, justified. American health care is for large segments of the population either not affordable, not accessible, not good enough or some combination of all three and the question that baffles most of us is why we can’t seem to get it right. The Concerned Actuaries Group believes that the answer to that question is two-fold. First and foremost, we don’t get it right because while our goals are laudatory, we do not engage the complexity and interactive phenomena of the health care system with the understanding and rigor required to actually achieve those goals. Imagine, for example, the complexity of determining the number, location and cost of the additional doctors, nurses, and allied health care professionals needed simply to maintain the 2008 health care status quo as forty million people were added to the Medicare and Medicaid roles between then and 2017. Our failure to adequately address that challenge meant for a variety of populations access got worse. Second, we don’t get it right because we don’t have access to the broader matrix analytics we need to make informed decisions and without that data the general public cannot effectively consider the merits of the changes being proposed.

CA2M - What it is being designed to do.

The Computer Actuarial Assessment Model (CA2M) has been developed to address both of these challenges. CA2M , for example, is a matrix-based model that can provide timely, relevant and powerful analytical ability to determine whether proposed changes will improve or harm America’s health care system. As such it can more fully inform both policy makers and their constituencies. 

It is important to note that the Concerned Actuaries Group is dedicated to enhancing public and policy maker ability to understand, evaluate and interact more effectively with decisions affecting the American healthcare system. The CA2M is a developmental tool intended to help policy makers and their constituents determine whether or not the changes being proposed might actually achieve their stated objectives and whether or not there might be unintended consequences attached to such changes.To that end, the model output highlights both the magnitude and duration of positive and negative consequences, and challenges advocates to address questions that experience tells us need to be asked. For example, had the CA2M been available in 2008 to provide such information, the following questions could have been raised (and possibly addressed) at that time, including:

  • Won't rising costs force the government to further discount payments?
  • Won’t deeper discounts lead to cost-shifting to the private sector? And, won’t that in turn eventually lead to rising out-of-pocket expenses for consumers?
  • Won’t increased urban demand for care result in shortages in rural areas?
  • What happens in terms of costs and sustainability if population health status deteriorates at a faster rate? 

While a work-in-progress, CA2M provides a strong framework to facilitate much more responsible consideration of health policy. Using this model to illustrate the broader impact of a given policy proposal should lead directly to an expectation that the public dialog expand beyond talking points.

CA2M - How it works.

The CA2M’s key features include:

A. An analytical matrix designed to provide the most holistic assessment currently available of how proposed changes to the American healthcare system might affect the system and the people who depend upon it. The matrix includes:

  1. An “X” axis that recognizes key market signals we believe reflect the areas of major activities and outcomes currently operating in the American healthcare system, including cost, coverage, access, health status, the economy, and sustainability;
  2. A “Y” axis that we believe recognizes all current service access platforms in the American healthcare system, including large group, small group, individual, Medicaid acute, Medicaid disabled, uninsured, Medicare and an “other” category;
  3. A data base that contains detailed, reliable, accessible information and expert opinion on eleven critical variables that inform assessment of interactive impact in each of the 48 intersections identified in the matrix, including population factors, cost estimates, risk market factors, demographics and utilization, health status, market costs, benefits, availability of providers, revenues and expenditures, and GDP.

B. An output capacity designed to identify for policy makers, opinion leaders, the news media and the general public the ripple effect of proposed actions and provide these same audiences with a mechanism that helps them understand in which areas the proposed changes need more work. The CA2M can, for example, highlight interactive challenges and opportunities of a proposed change related to provider infrastructure; financial sustainability; patient accessibility; household affordability; general economic impact and others.

C. An experiential growth capacity that allows the model to adjust and accommodate to reflect additional and/or new information as it becomes available. For example, the model includes a variety of behavioral algorithms that will evolve as new and/or additional data about specific behaviors becomes available.

CA2M - Current Status

The CA2M is progressing through a series of five, carefully considered and sequenced development phases that began in late 2017. Pending the acquisition of adequate funding and recruitment of additional expert resources, model development is poised to enter into Phase III. (see below).

I. Design and development of the “X” and “Y” axes of the comparative matrix.

II. Advanced documentation and enhanced capability of the prototype model

III. Advanced documentation and enhanced capability of the pre-operational model.

IV. Beta-Testing of the CA2M.

V. Establishment of a continual improvement and maintenance program for the CA2M.

Developmental Stages - Overview

CA2M - Frequently Asked Questions

Is the Concerned Actuaries Group (CAG) advocating for a particular recommendation or set of recommendations on how to “fix” the American Health Care system?


The CA2M is dedicated to evaluating proposed changes offered by others. The CAG does advocate for actuarial and economic principles related to the fiscal, and management factors training and experience tell us affect the quality, sustainability and efficiency of the system.

Is the CAG willing to share the information and assumptions that serve as the basis of the CA2M assessments?


Comprehensive documentation of the CA2M’s assumptions, calculations and base line data is available and will be made accessible for public review.

Has the CAG tested the CA2M on a proposed change to the American Health Care system?


The Concerned Actuaries Group beta-tested CA2M’s capability by using only information available in 2008 to evaluate the Affordable Care Act (as enacted) as a proposed reform against the data and assumptions existent at that point in time. The test was successful both in projecting a significant number of positive and negative outcomes that eventually occurred and in identifying areas in which more data was needed and where algorithms needed adjustment.

Has the CAG tested the CA2M the “Medicare for All” proposals?


There are a variety of “Medicare for All” ideas, none of which currently have enough detail to qualify as proposals and cannot, therefore, be assessed accurately. For example, It is impossible to evaluate the positive and negative impacts of such changes without considerably more data than appears to be available about what exactly would be involved in making these transitions.

The CAG has raised concerns about the sustainability of the current American healthcare system. Does the CA2M measure the sustainability of proposed changes?


In the context of the CA2M Model, “Sustainability” relates to the likelihood of a reform contributing to the ability to maintain the health system without interruption or weakening over the long-term (years or even a decade or more).

Last modified on Monday, 17 August 2020 15:12