By Edward “Ed” V. O’Neal, Vice President and Manager, Retirement PlansPrint This Post
Healthcare groups have encountered some turbulent times over the past few years, with particular challenges regarding healthcare reform and staffing shortages. Yet, this market continues to experience overall growth and healthcare providers continue to explore ways to find qualified staff. To help attract talent, a growing number of healthcare providers have started updating their retirement benefits programs to look like those found more in the corporate sector.
Given their nonprofit structure, many healthcare groups have a variety of options in sponsoring an employer retirement plan, including 403(b) and 401(k) plans. To help attract and retain qualified employees, a recent survey* found fewer healthcare groups sponsoring 403(b) or defined benefit plans than before, instead opting for a 401(k) plan. Additionally, surveys** show that healthcare providers are becoming increasingly proactive in adopting retirement plan best practices (many from the corporate sector) designed to both attract talent and drive employees toward retirement readiness. Some of these best practices include holding frequent employee retirement and financial educational meetings, offering attractive employer matching contributions, initiating automatic enrollment and deferral escalation features and offering a Roth contribution option.
With increased retirement plan complexity, a growing number of healthcare providers are looking for assistance with key plan functions, including understanding fees, assistance with plan design, review of investment menus, and plan participant education. With growing frequency, healthcare providers are turning to their plan or investment advisors to provide this support.
The pending political and economic shifts will likely continue to bring change and volatility to the healthcare sector, and healthcare providers will need to continue to be nimble and thoughtful in creating competitive retirement benefits programs designed to attract the best talent. Before initiating any employer sponsored retirement program, remember to consult with your tax/legal advisor and investment/financial advisor.
Benjamin F. Edwards & Co. does not provide legal or tax advice. Specific questions on taxes or legal matters as they relate to your individual situation should be directed to your tax or legal professional.
*2017 Retirement Plan Trends in Today’s Healthcare Market (Transamerica)
**2015 Retirement Plan Trends in Today’s Healthcare Market (Transamerica)