CDC Says U.S. Life Expectancy Fell to 76.4 Years in ‘21, Lowest Since 1996

Retirement plan consulting and actuary head says COVID-19 has muddled mortality outcome tracking, with the industry awaiting delayed IRS mortality improvement tables.

U.S. life expectancy decreased last year to its lowest level since 1996, partly due to increased deaths from COVID-19 and drug overdoses, the Centers for Disease Control and Prevention said Thursday—but the report should not be considered a signpost for future mortality calculations in the retirement industry.

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There were about 3.46 million deaths in the U.S. in 2021, and about 80,502 more than the total reported in 2020, according to the Mortality in the United States, 2021 report from the CDC National Center for Health Statistics.

The death rate for the U.S. increased by 5.3% from 835.4 deaths per 100,000 people in 2020 to 879.7 in 2021, data showed. As a result, life expectancy at birth for the U.S. population decreased from 77 years in 2020 to 76.4 years in 2021.

COVID-19 was a major factor in the change in mortality rates, ranking as the third most prevalent cause of death after heart disease and cancer. A rise in drug overdoses also contributed, accounting for more than one third of all accidental deaths in the U.S., according to the CDC. The rate of drug overdose deaths involving synthetic opioids, such as fentanyl, increased 22% from 17.8 in 2020 to 21.8 in 2021, according to the report.

Despite the decrease in life expectancy, actuarial tables that influence retirement planning and services may not see significant change, according to Christian Veenstra, co-president of Watkins Ross, a retirement plan consultant, actuary and administrator.

“Today’s headlines, while interesting, are likely based on averages of current data—that is, the earlier than expected deaths caused by COVID[-19] created [an] average age at death lower than expected,” Veenstra says in an emailed response. “But extrapolating that to future experience isn’t so cut and dried.”

Veenstra says that if deaths due to COVID-19 mostly impacted the elderly, that would have brought the actual age of death down, but would not necessarily provide information for the future mortality of survivors.

Mortality forecasts are used in the retirement and insurance industries for a number of purposes, ranging from determining funding for defined benefit plans to valuing annuities and life estates.

Veenstra says there are two schools of thought about how to measure the long-term impact of COVID-19 on mortality. The first is that COVID-19 caused the death of people who may have died at a younger age from a different cause (i.e. those with underlying medical conditions), thereby leaving behind more people with longer life expectancy. If that is true, Veenstra writes, then “some models actually project longer average lifespan by several months to a couple of years.”

In the second scenario, the long-term negative health issues for those who contracted COVID-19 may mean earlier death, pushing down the overall mortality rate.

Veenstra says his firm, Grand Rapids, Michigan-based Watkins Ross, is “eagerly awaiting” updates to mortality improvement tables that the Internal Revenue Service and Society of Actuaries usually publish in October, which have been delayed due to uncertainty forced by COVID-19.

He notes that when retirement advice is given on the individual level, many other factors enter the equation for decisions on asset distribution and associated costs, including family history, current health and past medical experience. Now that list will include exposure to COVID-19 and vaccination status.

“When we see decisions made by individuals in defined benefit pension plans—such as whether or not to take a lump sum, a type of joint and survivor or other annuity option, benefit commencement date, etc.—participants can become quite honest in order to maximize the benefit for themselves,” Veenstra says.

The CDC reported the leading causes of death in 2021, in order, to be heart disease, cancer, COVID-19, unintentional injuries, stroke, chronic lower respiratory disease and Alzheimer’s disease.

Xerox Has Preliminary Settlement In Excessive Fee Lawsuit

The $4.1 million settlement is pending court approval.


Xerox Corporation has agreed, in principle, to settle a 401(k) lawsuit with plaintiffs who alleged plan fiduciaries mismanaged the retirement plan by passing on to participants excessive fees for recordkeeping services.

Xerox will pay the $4.1 million gross settlement amount into a common fund established for the benefit of the settlement class and agree to intended provisions for prospective relief to plan participants, the court filing shows.

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“Xerox maintains the company acted prudently and loyally at all times when acting in any fiduciary capacity with respect to the plan,” a spokesperson wrote in an email regarding the litigation. “The settlement avoids the risk and uncertainty of further litigation for both parties.”

Per the settlement, no later than five years from the effective date of the agreement, defendants will use an independent consultant to assist with a request for proposal, fee benchmarking study or other comparative analysis to ensure that the plan’s recordkeeping fees remain competitive, according to the plaintiffs memorandum of law in support of motion for  preliminary approval of class action settlement

The settlement and motion for approval follow a full-day on October 11, in-person mediation with mediator David Geronemus, the filing shows.

The plaintiffs, represented by firms Nichols Kaster and Garrison, Levin-Epstein, Fitzgerald & Pirrotti, asked in their filing that the court approve the proposed settlement, calling the relief it grants “meaningful.”

“This relief directly addresses the core issue that plaintiffs raised in the lawsuit and is designed to ensure that the plan’s expenses are reasonable going forward,” plaintiffs’ attorneys wrote in the filing.

“This is a significant recovery for the class compared to the claims that were alleged, and it falls well within the range of negotiated settlements in similar ERISA cases,” the attorneys for the plaintiffs wrote. “The settlement also provides for meaningful prospective relief, as defendants have agreed to retain an independent consultant to assist them in ensuring that the plan’s recordkeeping fees remain competitive in the future by means of a request for proposal, fee benchmarking study, or other comparative analysis.”

The plaintiffs motion asks the court enter an order:

  • Preliminarily approving the settlement.
  • Approving the proposed notices and authorizing distribution of the settlement notices to the settlement class.
  • Certifying the proposed settlement class.
  • Scheduling a final approval hearing.
  • And granting any other relief described in the proposed preliminary approval order.

“Although defendants dispute the allegations and deny liability for any alleged violations of ERISA or any other law, they do not oppose relief sought in this motion,” the attorneys wrote.

The original complaint was brought before U.S. District Court for the District of Connecticut.

Xerox filed with the court a motion to dismiss the complaint, that was heard and denied  by Judge Sarala V. Nagala, in U.S. District Court  for the District of Connecticut, earlier this year.  

The proposed settlement applies to all participants and beneficiaries of the Xerox Corporation Savings Plan at any time from August 11, 2015, until January 1, 2021—excluding anyone responsible for the plan’s administrative functions or expenses—according to the plaintiffs’ attorneys motion for preliminary approval.

Based on the information provided by defendants, there are approximately 36,000 settlement class Members, according to the document.

Although not published with the memo, a copy of the class action settlement agreement was attached as Exhibit A to “an accompanying declaration of plaintiffs’ attorney Brock Specht,” with the Nichols Kaster firm, the court filing shows.

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