Health System Offers Award-Winning Benefits Plan

Dedicated retirement team uses tools/programs to maintain successful benefits package for employees

Trinity Health is a faith-based organization devoted to a ministry of healing. Trinity Health, the fourth-largest Catholic health system in the United States (based on Operating Revenue), employs 45,100 full-time equivalent associates and 7,346 active staff physicians. The organization is comprised of 23 Ministry Organizations in eight states: 46 hospitals (31 owned, 15 managed), 379 outpatient clinics/facilities, numerous long-term care facilities, home health and hospice programs, and senior housing communities.

Trinity Health’s Plan
To maintain its recruiting advantage within the health care market, Trinity Health provides its associates a competitive retirement program designed to assist them in providing a secure financial future. The majority of the organization’s associates are eligible for a 403(b) Retirement Savings Plan due to its not-for-profit status. The taxable entities within Trinity Health offer a 401(k) Retirement Savings Plan.

Trinity Health associates are also eligible for its defined benefit Pension Plan. While many companies have recently made the decision to freeze or terminate their defined benefit plans, Trinity Health decided to continue providing the Plan to its associates.

Award-Winning Education
In addition to its outstanding retirement benefits, Trinity Health provides its associates with award-winning retirement education. The Trinity Health retirement team partnered with its retirement savings plan service provider, Diversified Investment Advisors, to develop FOCUS on Your Future, a series of modules consisting of various retirement and financial planning tools, to provide associates with the information they need to plan for a secure future. The five FOCUS modules include: Total Retirement Program, Income & Expense Planning, Health/ Life/Long-Term Care Insurance, Estate Planning, and Lifestyle Issues in Retirement. Additional educational workshops are offered targeting topics such as asset allocation, long-term investing, and utilizing the tools and resources available on the Web site.

Each year, Trinity Health and its retirement savings plan service provider carefully develop a marketing campaign to raise awareness of the importance of saving for retirement. Elements that have proven to be effective include fun giveaways and posters with catchy graphics and phrases. The giveaways are not just “given away;” they require an action on the part of the associate. For example, a targeted mailing may be sent to a group of younger participants who are investing 100 percent of their deferrals in a fixed fund. The mailing offers these associates a free hat, T-shirt, light-up pen, or key chain if they meet with their on-site retirement plan specialist to discuss the importance of asset allocation and to make appropriate changes to their accounts. The giveaways generate more activity if associates show their freebies to their coworkers, who are in turn enticed to schedule an appointment with the retirement plan specialist.

Keeping the information simple and “light” has proven to generate the greatest results. For example, Trinity Health recently created a new-hire orientation video that features a simple stick man character. The video captures the attention of the audience with its humorous, non-threatening, and fun delivery. The stick man has been very effective in driving the desired associate behavior of participating in the Plan.

Making Investing and Enrollment Simple
For associates, selecting investments seems to be the most challenging part of enrolling. Trinity Health has simplified the process by providing an uncomplicated investment option that allows participants to select a portfolio based on their time horizon until retirement. Comprised of investment funds included in the Plan’s core offerings, this portfolio is automatically rebalanced at appropriate times, which requires no action by the participant. Another simple alternative available to participants is to select an asset allocation risk-based fund. Participants who are comfortable with selecting their own investments can choose the “do-it-yourself” method, selecting from the Plan’s investment fund lineup — including a self-directed brokerage account. Planning tools that provide asset allocation mix information, as well as full-blown retirement planning programs, are available on Trinity Health’s retirement program website.

Trinity Health’s service provider employs the equivalent of 16 full-time on-site Retirement Plan Specialists who provide new-hire associate education, present the FOCUS On Your Future retirement planning seminars, and meet with associates to assist with retirement planning. Thanks to the efforts of the on-site representatives, associate participation rates have increased 67 percent since 2002, during which time the number of eligible associates skyrocketed from 45 percent to an astonishing 75 percent. This rate far outshines the health care industry median of 58 percent.

Plan Administration
Trinity Health has a formal retirement savings plan investment review committee that meets quarterly to discuss the Plan’s investments, as well as the overall reasonableness of its plan fees. The committee consists and/or receives input from Trinity Health’s Plan Administrator; representatives from human resources, treasury and/or finance; and internal and outside legal counsel. Minutes are recorded for each meeting and submitted to Trinity Health’s Benefits Committee, the retirement savings plan investment review committee’s grantor of authority, for acceptance.

Because the Plan’s administrative and record keeping fees are paid via the revenue generated from mutual funds and revenue sharing agreements, it is imperative for Trinity Health to monitor these expenses by conducting a comprehensive plan review with the assistance of an experienced consultant. Review of the Plan was especially necessary due to the higher-than-expected asset growth over a five-year period, as well as an overall increase in service provider efficiencies. The special services particular to the Trinity Health plans had to be priced at a reasonable rate competitive with market bids.

Another important aspect of the Plan review process was to assign fixed fees to fixed services. For example, if the assets grew, the intention was not to hire additional representatives. The cost of providing on-site representatives was more of a fixed cost that increased only by an annual inflationary rate to accommodate salary increases. The marketing and communications budget assigned to the Plan is a fixed amount as well, so this expense was also earmarked with a dollar budget. If any portion of the marketing and communication budget is not utilized, or if cuts are made to the on-site representative staff, the relative savings are clearly defined and can be directly credited to participants’ accounts. Pricing break points were negotiated as well to provide for Plan growth to add shelf life and flexibility to the contract.

To ensure the quality of ongoing services, Trinity Health integrated several performance guarantees into the contract. These guarantees are assigned a monetary value prior to finalization of contract terms. A competitive contract is not only important for the Plan participants, but for the service provider as well. In a competitive and challenging market, service providers must be able to provide efficient services that enable client retention.

Conclusion
Trinity Health is a mission-based organization that is devoted to offering a competitive retirement program to assist their associates in saving for their retirement. The key to success in retirement plan communication is not contained in a single tool or method, but is a result of dedicated programs and a team that never stops trying new tactics to reach the Plan’s goals.

Silvia H. Frank is Manager, Defined Contribution Plans, at Trinity Health.