Already caught between flattening revenues and rising costs, many hospital CEOs are confronting a looming pension fund gap.
The University of Chicago, which includes the university and the medical center, and Resurrection Health Care Corp. were among the most underfunded pension funds for hospitals in the country, according to a study of 550 health systems by Standard & Poor's Ratings Services, based on 2010 financials.
While U of C's and Resurrection's retirement funding has improved, they are part of a group of five Chicago-area hospitals and health care networks whose pensions are less than 80 percent funded and are considered at risk of default, according to federal regulations. NorthShore University HealthSystem and Provena Health, which merged with Resurrection in 2011 to form Presence Health, also are below the threshold. The others are Northwest Community Hospital and Elmhurst Memorial Healthcare.
The five most underfunded hospital pension funds are among 10 major hospitals and health care networks in the Chicago area that owe a total of $1.12 billion to their pension funds, according to a Crain's analysis of the most recent financial statements.
Sunday, January 06, 2013
The Hospital Pension Problem
The issue of looming pension fund shortages will be the final death knell to academic medicine's resistance to joining the 21st century's shared-risk of the 40-3b/401-k retirement funds. From Chicago Business:
Who will pay Valerie Jarrett's pension? There will clearly need to be other cuts to pay Michelle Obama's pension.
ReplyDeletePension funding problems are big in Il, and lesser but still real elsewhere.
ReplyDeleteWith a $6-7 billion endowment (almost a billion for medical), somehow I think the University of Chicago will turn out OK.