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A large integrated health system was grappling with an underfunded active defined benefit (DB) plan, mounting PBGC premiums, and increasing funding shortfalls. Despite strong internal management, traditional methods were no longer sufficient to relieve the growing financial burden.
Seeking new strategies to reduce expenses and unlock liquidity, the health system partnered with O3 for a fresh, data-driven approach.
Using O3 Forensics, the team conducted an in-depth analysis of the pension plan, uncovering overlooked opportunities for premium and cash flow savings. The result was a simple yet impactful strategy to accelerate pension contributions by just four months.
This timing adjustment delivered immediate results. In 2025 alone, the client saved $3.6 million in PBGC premiums. More importantly, O3 developed a long-term financial roadmap, showing how short-term contributions would generate outsized long-term value.
Over a 10-year period, the client is projected to achieve:
$27 million in total cash flow savings
$37 million in PBGC premium savings
A $22 million reduction in plan funding shortfall
Together, these improvements translate to nearly $49 million in total economic value, improving financial stability and positioning the plan on a more sustainable trajectory.
October Three offers full-service actuarial support, covering everything you need to manage your plan efficiently. Call our team today to learn how our actuarial services can help mitigate risks associated with your retirement plans.