President's Message (August 23, 2010)

Dear colleagues,

This summer has been anything but a vacation at the Academy, as each of our practice councils has been busy on numerous initiatives.

I am pleased to report that a record number of Academy members responded to the annual Volunteer Survey to offer their expertise and time to Academy projects. More than 700 members signed up to volunteer, including more than 300 who offered to serve as inaugural members of the new Academy Advisors survey research panel. This demonstrates the deep commitment our members have to serving both the profession and the public interest. In addition, more than 2500 actuaries participated in the Council on Professionalism's June 17 qualifications webinar, which underscores your dedication to professional development.

A few years ago, the Academy took the bold step to add advocacy to our public policy work. Two years after we first advocated increasing the Social Security retirement age, this position has now come to the forefront of the debate. Policymakers in both political parties, as well as experts at nonpartisan interest groups, have joined the Academy in recommending that an increase in the retirement age is an essential component of any serious reform of Social Security.

Just a few weeks ago, with the early August release of the trustees' reports for both Medicare and Social Security, we were reminded again of the value of the actuarial perspective on America's social insurance programs. We may not always agree with the positions taken by the chief actuaries of Social Security and Medicare, but it is becoming increasingly essential for the Academy and our members to defend the importance of allowing these high-profile professionals to state their actuarial opinions free from the political constraints surrounding these programs. We support the actuarial independence that Mr. Goss and Mr. Foster require to continue doing their jobs and serving the public interest.

The need for fiscal reform was made clear in July when David M. Walker, the former comptroller general of the United States and now the president and CEO of the Peter G. Peterson Foundation, addressed the Academy's summer leadership summit. In his keynote address, Mr. Walker explained the seriousness of the deficit crisis facing the nation and the realistic options necessary to halve the deficit by the next decade.

The summer summit served as a forum for Academy leaders to examine nearly a dozen issues, with Medicare sustainability and ensuring lifetime income topping the list of positions on which the Academy will work to develop new public advocacy statements.

Meanwhile, we continue to offer our positions on public policy. One interesting example occurred earlier this summer when a congressional committee planning an emergency hearing on the Gulf oil disaster asked the Academy to comment on proposed legislation to change the liability caps on oil companies. With less than a week to prepare, Gary Josephson and the Casualty Practice Council developed a thoughtful analysis on what had become a supercharged, emotional debate. Pensions, financial regulation and health care saw similar opportunities to offer analysis of critical issues at the federal and state level.

Al Bingham and the Health Practice Council have shifted seamlessly from analyzing and commenting on health reform proposals to working with regulators on implementation of the legislation passed earlier this year. Recently we produced comment letters on the extension of dependent coverage to age 26, rate filing disclosure forms, and medical loss ratio requirements—among others. Be sure to check out the new healthcare implementation page (Actuarial Compass: Navigating Health Reform Implementation) on the Academy's website for all the latest news.

The issue of ensuring lifetime income has been gaining traction of late in the consumer media. And the Academy's work in this area has been getting some well-deserved coverage. Most recently, the Pension Practice Council and the Life Practice Council worked together to respond to a joint request from the departments of Labor and Treasury on ways to encourage lifetime income options in retirement. The Academy is well positioned to play an integral role in this increasingly important public policy issue.

Regarding the health of the Academy itself, membership remains strong, our operational and budget targets are being met, the Governance Task Force is well on its way to finalizing a report on its deliberations and the Strategic Planning Committee has been refining our mission and vision statements while developing our strategic direction. The Nominating Committee has finalized its recommendations to the board of directors for 2011 officers and I am pleased to congratulate David Sandberg on being nominated as our next president-elect. Others nominated to fill vacancies on the Executive Committee are Stephen Rosen as secretary, Tim Wisecarver as vice president of the Casualty Practice Council, Tom Wildsmith as vice president of the Health Practice Council and John Gleba as vice president of the Council on Professionalism.

This fall, when I hand the presidential gavel to president-elect Mary Frances Miller, the Academy will be announcing the winners of our Jarvis Farley and Robert J. Myers service awards—reminders of the contributions actuaries have and continue to make to serving the public interest. I hope many of you can join us in Washington on November 8 for the presentation of those awards at our annual meeting.

Until then,

Sincerely,

Ken Hohman
President
American Academy of Actuaries