Reading… Writing…. Arithmetic….. Simplify t o Quantify

Reading… Writing…. Arithmetic…..

Simplify to Quantify Bernard F. Pettingill, Jr., PhDPalm Beach Gardens, FLOctober 2010Las Vegas

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INTRODUCTIONINTRODUCTION

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•Background•Contact Points•Terms of Art•Presentation - Putting It All Together

OutlineOutline

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BUTCHER BAKER

CANDLESTICK-MAKER

JACK JILL

Juror ProfileJuror Profile

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Potential Jurors

Keep Estate Tax

Get Rid of Estate Tax

•Banker•Engineer•Nurse Practitioner•Arms Crossed / Legs•Age Factor•Note Takers•Sleeper•Questions from Jurors

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JuryJury

•New Orleans•Military HS•Catholic / Ivy League College / Ph.D.•England (Foreign)•Professor (Medical School - 4 yrs)•Articles•Three Kids - Teacher / Empathy•Organizations•Court TV / Congress•Two Grandkids

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HooksHooks

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CREDIBILITY

Jury AwarenessJury Awareness

•Posture / Clothes / Watch / Car / Truck•Body Language - Rocket Clemens; McGuire •Out of the Box•Permission

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•Life Expectancy / Work Life Expectancy•Inflation Measures - (Local News Stories)•Medflation•Interest Rates (IRR)•Consumption Expenses•Replacement Services at Home•Paradox of Thrift

Economic TermsEconomic Terms

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CPICPI

• Typical Market Basket• 95 Locations• Twice / Month• 211 Consumer Goods• Average Prices

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CPI - cont.CPI - cont.

1. Food & Beverages2. Housing3. Apparel4. Transportation5. Recreation6. Education & Communication7. Other Goods & Services8. MEDICAL CARE

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LOCAL NEWSPAPERLOCAL NEWSPAPER

GIGOPRN

QD / BID / TIDDUCES TECUM

CETERIS PARIBUSSWAG

AbbreviationsAbbreviations

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OLD INDICATORS

• AUTO• HOUSING• RETAIL

ForecastingForecasting

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NEW INDICATORS

• WAL-MART• STARBUCKS• APPLE• NETFLIX• PAWN SHOPS• ANIMAL RESCUE LEAGUE• McDONALDS• DOLLAR STORE

Forecasting - cont.Forecasting - cont.

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RatesRates

•Discounting to PV - Recent Historic Rate

•Alaskan - Total Offset

•Nominal Rate / Average Rate - 25 yrs

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• JUNK DOWN• MUNIS DOWN• CORPORATE DOWN• TREASURIES

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Discount RatesDiscount Rates

Verdict

Bartow

3/2009

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$65 M$65 M

Life Expectancy

•Census Data - 2010

•Optimal Care - Based on L.E.

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LIFE EXPECTANCY

LESSON 1LESSON 1

= 2.9 = 1.7

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Classification of Economists

LaborPublic PolicyFinancial

AgriculturalBehavioralHealth/Medical

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Not The Same

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• ENGLAND, CANADA & SWEDEN • INSURE 30+ MILLION PEOPLE - H.R. 3200 • AMERICA’S AFFORDABLE HEALTH CHOICES ACT • ELECTRONIC MEDICAL RECORDS

Nationalized Health Care

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•New Technology•Waste, Inefficiency & Fraud•Drug Company R&D•Aging Population

Reasons for Cost Increases

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•ELECTIVE SURGERY

•WAITING LIST - HERNIA REPAIR

•RENAL DIALYSIS

•55+ Yr Old, GREAT BRITAIN – DENIED….DEAD

Health Care - DILEMMAHealth Care - DILEMMA

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•SIXTY YEAR OLD MALE POSTAL WORKER

•SINGLE MOTHER OF FOUR CHILDREN

•EIGHTEEN YEAR OLD NEVER WORKED

•RETIRED PALM BEACHER

Organ Replacement - DILEMMAOrgan Replacement - DILEMMA

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MEDICAL INFLATION RATES

•Current (NOW) = 3.5%

•Recent (10Yrs) = 4.0%

•Historic (25Yrs) = 5.0%

LESSON 2LESSON 2

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Medical CareGrowth Rates

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YEAR1995

2000

2004

2006

2008

2010

MEDICAL5.1%

4.3%

4.3%

4.2%

3.8%

3.5%

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AMERICA’S AFFORDABLE HEALTH CHOICES ACT

HR 3200

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?

1. Therapists / Nurses2. Treating / Evaluating M.D.’s3. Continuation of Care Planner / Rehab Expert4. Economist

Sequence of Experts

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Continuation of CareContinuation of CareLife Care PlanLife Care Plan

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•Routine M.D. Visits•Therapies•ADL’s•Diagnostics•Orthopedic Equipment•Supplies

Categories of Need

•Attendant CareAttendant Care36

Boston Vs New Haven• Large Med-Schools• Well Informed M.D.’s• Same Region Country• No Difference in Socio-Economic Status

Treatment PatternsTreatment Patterns

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• White Female• Age 2.0• Life Expectancy = 79.9 years• 24 Hour Nursing Care (HOME)• $30.50/Hour/LPN• Discount Factor = 4.0%

ExampleExample

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•Current (NOW) = 3.5%

•Recent (10Yrs) = 4.0%

•Historic (25Yrs) = 5.0%

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MEDICAL INFLATIONMEDICAL INFLATION

Current: Growth Rate = 3.5%Present Value = $17.5m

Recent: Growth Rate = 4.0%Present Value = $21.2m

Historic: Growth Rate = 5.0%Present Value = $31.1M

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RESULTSRESULTS

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INTEGRITY

• Recent Life Expectancy Tables

• Medical vs. General Inflation

• Sample - Goods / Services1940, 50, 60, 70, 80, 90’s

Trial Charts

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Presentation

•Earning Capacity - Cistern•Present Value - ‘Car Loan’•Court Reporter Interruptions•9/11 - Security•Jack Pot Justice / Home Cooking

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VerdictFort Meyers - John Romano, Esq.

Florida

12/2009

$44.9 M

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Verdict

Miami, FL

4/2010

$11.6 M

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Verdict

Florida

9/2010

$8.2 M

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Verdict

Florida

9/2010

$21.6 M

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Verdict

Little Rock, AR

9/2010

$20.1 M

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Verdict - Ford

Jackson, MS

9/2010

$131 M

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Summary 3 Lessons

• LE

• MEDFLATION

• LESS IS MORE

LAW OF LARGE NUMBERS

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CONSULTING ECONOMIST

PHONE (561) 622-0330CELL (561) 346-7828FAX (561) 624-2854TOLL FREE (800) 662-0330

#93 Sandbourne LaneP.G.A. NATIONALPALM BEACH GARDENS, FL 33418E-mail: biffpett@gate.net

BERNARD F. PETTINGILL, PH.D.

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•Homework - CSI•Financial Records•Tax Returns - Official IRS Records - Alignment, Dates, SS#, Signatures, Copies, Income / Expense Flow•Past Meds Minimal•Darden - (doc location: G drive) - CSI

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