Retaining surgeons, specialists, and other key personnel

Situation:

A hospital’s board of directors wanted to put an end to rising defections by its surgeons, specialty doctors, department heads, and executives.

Action Steps:

After reviewing several options presented by Grant Hinkle & Jacobs, the hospital’s board decided to:

  • Offer a Supplemental Executive Retirement Plan (SERP) benefit to three classes of employees – physicians, department heads, and executives – each with different terms and considerations.
  • Utilize permanent insurance on the lives of the participants as the primary funding source for the plan, which required many of the participants to only answer four health questions to receive approval.
  • Provide the money the hospital needs to fund the SERP by repositioning some of the hospital’s cash/liquid assets from the bank that as earning less than 1% to a cash alternative earning between 3% and 6% net.

Results:

The board is extremely pleased they can offer significantly more benefits to attract and retain their key executives at no additional cost.  The participants are also appreciative that they are being recognized with additional benefits, including increased income, long-term health care coverage, and a death benefit, resulting in improved morale and significantly reduced turn-over.