Department Of Defense Agency Financial Report 2007 - Section 2: Financial Information Page 60
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82Department of Defense Agency Financial Report 2007
Section 2: Financial Information
72
Change in MRF Actuarial Liability
(Amounts in billions)
Actuarial Liability as of 9/30/06
$963.7
Expected Normal Cost for FY 2007
17.7
Plan Amendment Liability
1.5
Assumption Change Liability
26.5
Expected Benefit Payments for FY 2007
(43.5)
Interest Cost for FY 2007
57.1
Actuarial (gains)/losses due to changes in trend assumptions
2.2
Actuarial Liability as of 09/30/07
$1,025.3
Change in Actuarial Liability
$61.6
Actuarial Cost Method Used: Aggregate entry-age normal method.
Market Value of Investments in Market-Based and Marketable Securities: $215.0 billion
Assumed Interest Rate: 6.0%
Military Retirement Health Benefits (MRHB)
The MRHB are post-retirement benefits the Department provides to non-Medicare-eligible military retirees and other eligible
beneficiaries, through private sector health care providers and Department Medical Treatment Facilities. The Department
used the following assumptions in calculating the FY 2007 actuarial liability.
Medical Trend
FY 2006 – FY 2007
Ultimate Rate FY 2031
Medicare Inpatient
6.74%
6.25%
Medicare Outpatient
6.54%
6.25%
Medicare Prescriptions (Direct Care)
6.25%
6.25%
Medicare Prescriptions (Purchased Care)
6.25%
6.25%
Non-Medicare Inpatient (Direct Care)
6.25%
6.25%
Non-Medicare Outpatient (Direct Care)
6.25%
6.25%
Non-Medicare Prescriptions (Direct Care)
6.25%
6.25%
Non-Medicare Inpatient (Purchased Care)
6.25%
6.25%
Non-Medicare Outpatient (Purchased Care)
9.48%
6.25%
Non-Medicare Prescriptions (Purchased Care)
9.84%
6.25%
Change in MRHB Actuarial Liability
(Amounts in billions)
Actuarial Liability as of 09/30/06 (Department preMedicare + all Uniformed services
Medicare cost-basis effect)
$299.2
Expected Normal Cost for FY 2007
$10.0
Expected Benefit Payments for FY 2007
($10.4)
Interest Cost for FY 2007
$19.0
Actuarial (gains)/losses due to other factors
($11.9)
Actuarial (gains)/losses due to changes in trend assumptions
$11.9
Actuarial Liability as of 09/30/07 (Department preMedicare + all Uniformed Services
Medicare cost-basis effect)
$317.3
$18.1
Change in Actuarial Liability
Actuarial Cost Method Used: Aggregate Entry-Age Normal Method
Assumed Interest Rate: 6.0%
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