Bill Chin, MD, Executive Medical Director, HealthCare Partners (400+ Physicians)
On Retirement Plans. Retirement rarely comes up in discussions, but it is very much on our physicians' minds. We conducted focus groups to see what was valuable and important to our partners in terms of their long-term security needs. Number one to them was a reliable and safe retirement savings program. We underwent a comprehensive analysis of what was available to medical groups.
Results? Kravitz helped us enhance our 401(k) Profit Sharing plan by adding a Cash Balance plan. Senior Partner Physicians were then able to contribute an additional $30,000 annually to their retirement plan—almost double what they were saving prior to the Cash Balance plan. We believe this kind of competitive benefit will help us both attract and retain the caliber of doctors we want at HealthCare Partners.
What should a medical group look for in a pension design firm? You want someone who can make the difficult, simple. Pension firms have the same challenge we do as clinicians; we must make the complex understandable and practical. We found that Kravitz had that blend of knowledge and simplicity. Dan Kravitz was the consummate spokesman for the firm of Louis Kravitz & Associates. He was articulate, knowledgeable and above all, he was easy to understand. Kravitz showed us how to structure a retirement program that would help our physicians actually reach their retirement goals.
What advice do you have for other medical directors? Get educated. Learn all you can about pensions and investing. But even before that, designate a point person to do much of the legwork so you don't get mired in the details.
Robert Master, MD, FACC, Pension Committee Chairman, Camino Medical Group/Palo Alto Medical Foundation (200+ doctors)
On Retirement Plans. Because of the time demands of medical school, residency and sometimes a fellowship program, physicians often feel a need to “catch up” on retirement savings. Many physicians think the medical group can only contribute the Profit Sharing maximum (of $44,000 in 2006) annually to their retirement plan. But the group can do more.
How did you redesign your pension program? Our mid-career physicians were dissatisfied with the quality of our pension plan. So we undertook an external plan-redesign bid process to overhaul the existing plan and see if we could increase the pre-tax contributions the physicians could make. The pension committee invited several pension-design firms to make a proposal to our pension committee.
Results? When the pension committee learned from Kravitz about the Cash Balance options, we knew we had found the answer. Kravitz helped us add a Cash Balance plan to the existing plans and almost doubled contribution amounts for physicians over 40. Additionally, several doctors in their 50s are receiving over $125,000 in the three plans combined.
Conclusion. Those of us on the pension committee are very happy with the results and the dramatic improvement in the group's retirement package as a result of the Cash Balance plan.
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