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Health Actuaries: Game Changers or Human Calculators?

Updated: Mar 18


woman with confused face holding abacus

Can health actuaries make the U.S. healthcare system better, or should we be content serving as “human calculators''?


Though I’m paraphrasing, this provocative question was posed to an SOA panel at July’s SOA Health meeting, and I was more than a little intrigued. With four industry heavyweights Stacey Richter, Erica Baird, J.R. Clark, and Keith Passwater tackling the topic, surely the answer was “YES, actuaries do make healthcare better!”?


Spoiler alert, it was a resounding yes. But after 17+ years in healthcare analytics, with a majority in the innovative payment designs of value-based care and alternative payment models, I propose the answer is more accurately “yes, when…”, with value-based care contracting as a primary lever (more on VBC outlook here).


Actuaries make the healthcare system better, and support industry innovations:

  • when actuaries level up from being order takers, making models on demand

  • when leaders & actuaries have two-way conversations about business objectives

  • when leaders invest in actuarially credible tools to elevate actuaries’ work


man holding sign saying "Hi! I'm Jim."

Consider Jim, a strategic business manager at ABC Health Plan who knows he needs to get ahead of the VBC tsunami coming his way. He’s got a brilliant idea that can save millions, giving his health plan a great story for growing membership. His idea interweaves technology-enabled population health tools providers are raving about, classic benefit design levers, and of course incentive bonuses when key performance indicators are achieved. It’s a health plan differentiator and Jim knows the most progressive employers are going to be 100% in. Jim’s leadership insists on actuarial modeling before any sign off.


Depending on how ABC Health Plan’s actuarial team answers the “yes, when…” question, Jim’s reaction will be “Ugghhh” or “Already on it!”


SCENARIO # 1 - The “Ugghhh” Scenario


Jim thinks of his actuarial colleague, Jane, as an order taker. She and her team have a reputation, and it’s not always complimentary. Sure, they’re fact based and detail oriented, but they are overburdened and dogmatic with guidelines. Jim takes a rote approach. He puts in his order and gets someone on Jane’s team assigned to the modeling effort. He asks for risks and pitfalls in his idea. He doesn’t want an opinion about whether to take those risks or not. He and Jane go back and forth over email for a couple of weeks versioning scenarios, different targets and trend assumptions, and he gets her professional certification—blessing or condemning the pitch. Then Jim is either off to the races or back to square one. Meanwhile Jane’s on to the next modeling request, having checked this one off as “completed”.


SCENARIO # 2 - The “Already on it!” Scenario:


Jim and Jane already have a strong relationship because they meet monthly to catch up on the latest scoop and share ideas. Since implementing a modeling platform with a two-way workspace for negotiating VBC contracts, Jane’s actuarial team has had more capacity and hunger to co-create ideas. Jim and Jane plan a co-designing session of their teams, and they really dig into Jim’s idea. They reach a shared understanding of Jim’s objectives, targets, and potential clients, and they meet daily for a quick standup to ask questions and share new learnings. The concept is refined in ways Jim couldn’t have imagined. Moreover, Jim and Jane present the idea to leadership together demonstrating alignment and buy-in to executive leadership, fast tracking a greenlight.


Which of these scenarios sound like your company? Are you dealing with more “Ugghhs” than “On it’s”? ... Maybe it’s time to consider a new approach.



Emily Walker headshot

Emily Walker is an accomplished 20 year healthcare analytics veteran with strong analytical and story-telling skills, a propensity for creative problem solving, and passion for transforming healthcare.


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