From Numbers to Health: How Actuaries Are Changing the Game in Healthcare

The Actuary's Evolving Role in Healthcare

The healthcare industry is undergoing a significant transformation, and actuaries like myself are finding ourselves at the forefront of this change. You might picture us as number crunchers, immersed in spreadsheets and data analysis. Well, we can certainly handle the complex calculations, but that's just one aspect of our expertise. In healthcare, our skillset is expanding rapidly. We're leveraging our analytical abilities to tackle some of the industry's biggest challenges: controlling costs, ensuring access to quality care for everyone, and most importantly, improving patient outcomes across the board.

A prime example of actuaries’ evolving role is the Society of Actuaries' (SOA) 18|11 initiative, launched in 2018. My own experience working on programs like Maryland's Young Adult Subsidy Program further exemplifies how actuaries can influence real-world healthcare policy. These programs demonstrate our ability to design and implement solutions that expand access to health insurance for specific populations.

Harnessing the Power of Technology

Technological advancements are another way actuaries are revolutionizing healthcare. We're integrating cutting-edge tools like AI and machine learning into our work. These powerful tools allow us to analyze massive datasets and uncover hidden data gems. This newfound clarity empowers us to:

• Forecast trends with pinpoint accuracy: By analyzing historical data and identifying patterns, we can predict future healthcare needs with greater accuracy. This allows for proactive resource allocation, ensuring that the right care is available in the right places at the right time.
• Assess risks holistically: AI and machine learning models can consider a wide range of factors, including medical history, social determinants of health, and even genetic predispositions. This comprehensive analysis helps us identify hidden risk factors and develop more targeted and effective healthcare strategies.
• Provide strategic guidance for designing future-proof, financially sound healthcare policies: Our data-driven insights can inform the development of sustainable healthcare policies that meet the evolving needs of the population.

In healthcare, GBMs (Gradient Boosting Machines) are a powerful example of how we leverage AI. These intelligent decision trees can analyze massive datasets and predict future events with incredible accuracy.

In healthcare, GBMs have impressive applications. For instance, I've used them to predict hospital readmission rates. Here's how it works: By feeding historical data into the GBM model, we can consider various factors – age, medical history, and even social determinants of health like access to healthy food or reliable transportation. This allows us to identify patients at high risk of needing to return to the hospital within a certain timeframe.

This predictive power is significant. By pinpointing high-risk patients, hospitals can proactively intervene with targeted care plans, potentially preventing readmissions and improving patient outcomes. It's a win-win situation: patients receive better care, hospitals reduce costs, and the overall healthcare system becomes more efficient.

The Power of Collaboration

We've discussed the evolving role of actuaries and the power of technology in healthcare. But actuaries don't operate in isolation. A critical ingredient to our success is collaboration.

Imagine healthcare as a complex puzzle. Actuaries bring a unique piece to the table – our analytical expertise. But to create a complete picture, we need to work alongside other specialists. This might include data scientists who can help us refine our models, policymakers who understand the regulatory landscape, and healthcare providers with their on-the-ground experience.

The Maryland's Young Adult Subsidy Program I mentioned earlier is a perfect example of successful collaboration. This program involved actuaries, policymakers, and healthcare providers working together to design and implement a solution that expands access to health insurance for young adults (you can find more information about the Maryland Health Benefit Exchange here: https://www.marylandhbe.com/). By combining our diverse skillsets, we were able to create a program that benefits a specific population segment.

This collaborative approach isn't limited to specific programs. It's becoming increasingly common across the healthcare industry. Actuaries are regularly partnering with other professionals to tackle challenges like cost control, population health management, and improving patient outcomes.

Value-Driven Insights: Actuaries and the Future of Healthcare

The future of healthcare is all about value. We're moving away from a system focused simply on the volume of services provided, and instead striving to deliver high-quality care that improves patient health at a sustainable cost. This is where actuaries play a vital role.

Our analytical skills allow us to develop data-driven insights that can inform healthcare policy and guide decision-making. For instance, we can use predictive models to identify patients at high risk of developing chronic conditions. By intervening early with preventative measures, we can potentially improve patient outcomes and reduce overall healthcare costs.

Another area where actuaries are making a difference is Value-Based Care (VBC) models. VBC focuses on rewarding providers for delivering quality care, rather than simply the quantity of services. Actuaries can help design and implement VBC payment models, analyze their effectiveness, and ensure they achieve the desired outcomes.

Conclusion

The healthcare landscape is constantly evolving, and actuaries are emerging as key players in this transformation. By leveraging technology, collaborating with other professionals, and providing value-driven insights, we're helping to create a more efficient, effective, and patient-centered healthcare system.