A look inside the actuarial black box.
Hospital executives often rely on actuaries (and their "black boxes") to determine self-insurance program liabilities and funding contributions. Typically, the hospital supplies the actuary with a myriad of statistics, and eventually the hospital receives a liability estimate and recommended funding level. The mysterious actuarial calculations that occur in between data reporting and receipt of the actuary's report are akin to a black box--a complicated device whose internal mechanism is hidden from or mysterious to the user.
Actuarial Analysis↗