Saving $1M for a Non-Profit Healthcare Provider with a Frozen Pension Plan Optimization
Learn how October Three’s forensic analysis and expert strategy empowered a non-profit healthcare provider to reduce costs and secure plan termination.
Situation
A large nonprofit healthcare provider, managing a frozen and underfunded pension plan with $100 million in assets, was burdened by volatile contribution demands and administrative costs exceeding 1% of plan assets annually. The organization needed a clear, strategic path to fully fund and terminate the plan while minimizing financial strain.
Approach
To address this challenge, the team conducted a forensic analysis of the pension plan, examining historical funding patterns, current liabilities, and future scenarios over a five to 10-year horizon. This deep dive revealed hidden inefficiencies in the organization's PBGC premium strategy, enabling informed decision-making around plan funding strategy and termination planning to provide immediate cost-saving opportunities.
Results
The result was an immediate savings of $1 million by changing PBGC premium strategies. A long-term contribution policy was also established to reduce administrative expenses and fully fund the plan for termination.
With a sustainable strategy in place, the healthcare provider gained a clear path to exit the pension plan efficiently and cost-effectively, ensuring financial stewardship while honoring commitments to participants.
Actuarial Services for Your Business
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.
