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The Actuary The magazine of the Institute & Faculty of Actuaries

Actuarial integrity under pressure

Richard S Foster became briefly perhaps the most famous actuary in the world during March and April. At a time when the integrity of actuaries is being challenged as never before, his story sets perhaps a different example.

Richard Foster is chief actuary at the Centers for Medicare and Medicaid Services in the US (Medicare and Medicaid are the principal US government programmes providing health services to elderly and impoverished citizens). During 2003 the administration wanted to gain Congressional approval for politically attractive changes to the Medicare benefits for the elderly. Foster’s actuarial estimates of the costs involved was approximately 50% higher than the estimates provided by the administration to Congress. It is alleged that Foster’s then superior suppressed the higher estimates in order to get the changes through Congress.

This emerged in recent testimony by Richard Foster to Congress in relation to potential action against his superior. Foster resisted the temptation to resign from his job, and has been widely praised for his bravery in giving his account of events.

He will be a speaker at the forthcoming annual meeting of the American Academy of Actuaries. Messages of support can reach Richard Foster at rfoster1@cms.hhs.gov.