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This thread is for issues related to Kaiser Northern California (TPMG) benefits, retirement plan/pension etc.
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Last edited by fatlittlepig; 09-13-2020, 12:26 PM. -
I'm a lot earlier in my career path than you are so I have limited perspective, but my 2 cents:
1. That is my understanding, yes. If you retire before 60 and want full payments, then you have to wait until 65. You can start getting reduced, early payments at 55 or when age + years worked = 75. However, if you keep working until 60, then you're eligible to receive full payments at that time from the supplemental plan. I guess 60 is still considered "early" retirement by most.
2. Who knows. Things look pretty good right now but healthcare economics are too dependent on politics and too hard to predict. If you don't mind me asking, what payout terms did you take for your deferred compensation? And approximately what percentage of your compensation are you deferring? If you want to retire early and use your deferred compensation to tide over until your pension kicks in, I can see it being a good option. Do you know a lot of people taking deferred compensation? It's a definite risk if your timeline is really 20 years out.
3. True, and it's really a kickass plan.
Few extras:
If you make more than 270k base salary, then you have to take that ugly lump sum makeup payment from the supplemental plan at age 65.
Make sure you're full funding your 401k after-tax contributions. I'm doing the mega backdoor roth every year but if you're gonna retire soon, then it might be better to wait until then to convert to roth obviously. -
Wife separated back a few years ago after 10 years with Kaiser
1. Early retirement 60 is feasible, and if you qualify, yes on the full benefits. It used to be 55+20years, but that probably changed
2. This is the risk of the DCP with any plan -- even Kaiser. How adays Kaiser is flush and sitting pretty. It was a very different story pre Dr. Pearl in the 90s. I would have a hard time sleeping with 7 figures in the plan, truthfully. Why the risk? Not worth it IMHO. You'll have plenty of $$$, do the safe thing IMHO. With the recession 2007, the pension plans took a hit and I remember it going down into the 80% funded around that time. With the obamacare intact for now, at least a little more stability in the near future---for at least the weekend.
3. Yes, Kaiser's pension is secondary to very few. Kaiser 'eats their young' with the high initial attrition rate, but takes care of its own in a very good way beyond just the pension plan.Comment
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Wife separated back a few years ago after 10 years with Kaiser
1. Early retirement 60 is feasible, and if you qualify, yes on the full benefits. It used to be 55+20years, but that probably changed
2. This is the risk of the DCP with any plan — even Kaiser. How adays Kaiser is flush and sitting pretty. It was a very different story pre Dr. Pearl in the 90s. I would have a hard time sleeping with 7 figures in the plan, truthfully. Why the risk? Not worth it IMHO. You’ll have plenty of $$$, do the safe thing IMHO. With the recession 2007, the pension plans took a hit and I remember it going down into the 80% funded around that time. With the obamacare intact for now, at least a little more stability in the near future—for at least the weekend.
3. Yes, Kaiser’s pension is secondary to very few. Kaiser ‘eats their young’ with the high initial attrition rate, but takes care of its own in a very good way beyond just the pension plan.
As a soon to be fresh residency graduate and new employee of TPMG, I was hoping you and other current employees could answer some questions.
1) Can you tell me about the 401k? One of the posts above makes it seem like after-tax contributions are possible for backdoor Roth. Do the funds in the 401k have low ER?
2) The DCP everyone referenced, is that the "Plan 2"? If so, how are people obtaining 7 figure balances, even if your salary maxes out at the IRS compensation limit (~270k right?) that only works out to about $20k/year.
3) What is meant by " then you have to take that ugly lump sum makeup payment from the supplemental plan at age 65". Is the supplemental plan, Plan 1?
4) You wrote "Kaiser eats their young", can you tell me more about what leads to the high initial attrition? I'm hoping to avoid that outcome, so I want to go in with realistic expectations. If you would prefer to answer this via PM that is fine as well
Thanks for answering the questions. If you have any other tips for maximizing Kaiser's benefits for long term financial security, please do share.Comment
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Wife separated back a few years ago after 10 years with Kaiser
1. Early retirement 60 is feasible, and if you qualify, yes on the full benefits. It used to be 55+20years, but that probably changed
2. This is the risk of the DCP with any plan — even Kaiser. How adays Kaiser is flush and sitting pretty. It was a very different story pre Dr. Pearl in the 90s. I would have a hard time sleeping with 7 figures in the plan, truthfully. Why the risk? Not worth it IMHO. You’ll have plenty of $$$, do the safe thing IMHO. With the recession 2007, the pension plans took a hit and I remember it going down into the 80% funded around that time. With the obamacare intact for now, at least a little more stability in the near future—for at least the weekend.
3. Yes, Kaiser’s pension is secondary to very few. Kaiser ‘eats their young’ with the high initial attrition rate, but takes care of its own in a very good way beyond just the pension plan.
As a soon to be fresh residency graduate and new employee of TPMG, I was hoping you and other current employees could answer some questions.
1) Can you tell me about the 401k? One of the posts above makes it seem like after-tax contributions are possible for backdoor Roth. Do the funds in the 401k have low ER?
Yes very good plan options, low ER's
2) The DCP everyone referenced, is that the “Plan 2″? If so, how are people obtaining 7 figure balances, even if your salary maxes out at the IRS compensation limit (~270k right?) that only works out to about $20k/year.
There is a Permanente contribution plan which comes out to be about 20K year that TPMG gives you. (only fully vested after 5 years)
Then's there the Deferred comp plan which you can contribute up to 100% of your salary (pre-tax).
3) What is meant by ” then you have to take that ugly lump sum makeup payment from the supplemental plan at age 65″. Is the supplemental plan, Plan 1?
Yes
4) You wrote “Kaiser eats their young”, can you tell me more about what leads to the high initial attrition? I’m hoping to avoid that outcome, so I want to go in with realistic expectations. If you would prefer to answer this via PM that is fine as well
Thanks for answering the questions. If you have any other tips for maximizing Kaiser’s benefits for long term financial security, please do share.
Comment
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As a soon to be fresh residency graduate and new employee of TPMG, I was hoping you and other current employees could answer some questions.
1) Can you tell me about the 401k? One of the posts above makes it seem like after-tax contributions are possible for backdoor Roth. Do the funds in the 401k have low ER?
Welcome aboard! I've been working for TPMG for almost 10 years & I'll be glad and try to answer some of your questions.
The 401k is through Fidelity. They have a variety of funds to choose from with very low ERs (some funds are 0.00). The funds are commingled trust funds not mutual funds so you can get them less expensively. Yes, you can make after-tax contributions which can be converted in-plan to Roth $ (the mega-backdoor Roth as described by WCI). It's fairly easy to do (you can do the conversion once per quarter). You can contribute a maximum after-tax (in 2017) of $54,000 - 18,000 - KPs Plan 2 contribution (more on this below). If you make more than 270k, that ends up being $15,360 this year. (if you make less than 270k, you can contribute more after-tax since your Plan 2 money from KP will be less).
2) The DCP everyone referenced, is that the “Plan 2″? If so, how are people obtaining 7 figure balances, even if your salary maxes out at the IRS compensation limit (~270k right?) that only works out to about $20k/year.
No, as FLP pointed out above Plan 2 is different than the DCP. Plan 2 is the KP equivalent of an employer match... other than they aren't matching anything, just giving you the money straight up. The amount is based on your salary. They give each physician 5% up to the social security wage base and then 10% of the difference between the annual compensation limit (270k this year) and the social security wage base. If I did the math correctly, KP will give physicians making over 270k $20,640 this year. This money is not yours right away. There is a vesting process over 5 years. The DCP (or deferred compensation) is completely separate from the 401k. I've been putting a bit away in this the past couple of years, but it's a complicated plan (strict limits on when and how you can get the money back) and it is a non-qualified plan (so extra risk there).
3) What is meant by ” then you have to take that ugly lump sum makeup payment from the supplemental plan at age 65″. Is the supplemental plan, Plan 1?
Plan 1 is the pension plan. The general rules are laid out by FLP up at the top of this thread (2% per year of the first 20 years, etc). After that it gets a bit complicated. If you make less than the compensation limit, the lump sum payment doesn't apply. If you make more than this amount, your pension is divided into two parts (starting at age 65... it is different from ages 60-65). The two parts are the pension part (payments in any number of different ways) which is based on the compensation limit times your pension percentage (example if you worked for 20 years, 40% times the compensation limit). The second part of the pension is the lump sum (given the month after your turn 65, assuming you are retired at that point). Let's say your average salary of your 3 highest years is 100k over the compensation limit. TPMG will give you a lump sum to make up for the fact that 100k is not reflected in the monthly pension payments. (it ends up being two lump sums, one being a gift from TPMG to help deal with the potentially very expensive tax bill that comes along with the first lump sum. Apparently you can't avoid paying taxes including CA state taxes on this regardless of where you are living at the time of the payment). Confused yet? :-)
4) You wrote “Kaiser eats their young”, can you tell me more about what leads to the high initial attrition? I’m hoping to avoid that outcome, so I want to go in with realistic expectations.
KP has been a reasonably fine place for me to practice. Most days I find things very reasonable. I have more time to spend with my family than I did when I was in my previous private practice. Of course on some days, it doesn't feel reasonable at all... Remember this is a huge organization with variation from medical center to medical center and department to department. Some department chiefs are fantastic and some are not. Some departments foster a sense of collaboration and some do not. I know from my regional work that these variations can be enormous within the same specialty.
A new CEO will be starting this summer. The changes from this transition may be little and hardly felt or may be the start of a massive shift in the lives of the TPMG physicians. We'll find out soon enough.
OK, if you're still reading, I hope you find this helpful.
WWComment
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1) Can you tell me about the 401k? One of the posts above makes it seem like after-tax contributions are possible for backdoor Roth. Do the funds in the 401k have low ER? 2) The DCP everyone referenced, is that the “Plan 2″? If so, how are people obtaining 7 figure balances, even if your salary maxes out at the IRS compensation limit (~270k right?) that only works out to about $20k/year. 3) What is meant by ” then you have to take that ugly lump sum makeup payment from the supplemental plan at age 65″. Is the supplemental plan, Plan 1? 4) You wrote “Kaiser eats their young”, can you tell me more about what leads to the high initial attrition? I’m hoping to avoid that outcome, so I want to go in with realistic expectations. If you would prefer to answer this via PM that is fine as well Thanks for answering the questions. If you have any other tips for maximizing Kaiser’s benefits for long term financial security, please d
Wally does a great job getting into the details:
Plan 1 - Pension Plan - traditional plan : general: 2%/yr x20years then 1%/yr afterwards - limits apply and convoluted rules - VERY generous
Plan 2 - Contribution Plan - after 1st year, Kaiser contributes directly 5% to SS limit, then 10% afterwards. Vesting rules
Plan 3 - Employee Plan = 401k deferred plan
Plan 2+3 are handled by Fidelity - very good options available.
Outside these three plans, once a shareholder, you're eligible for their DCP which is essentially a giant loan to Kaiser. You can put serious dollars into this plan too, but we elected not to do it.
There's also the buyin for the shareholders which we made out quite nicely when at separation
Kaiser is run quite well and embodies the 'top of license' work concept --sometimes pushing the limits of such. To that, docs rarely do non-doc work (as opposed academic centers or VA). There is rarely downtime or dummy work. For better or worse, that makes an action packed day and at times double packed if staffing is down (or demand outstrips anticipated supply that day). So productivity and speed with quite fast at Kaiser. A lot of incoming freshly minted residents don't realize this, enamored only by the platinum benefits package, and simply drown from the rate of Kaiser throughput and wash out within 5 years. This is actually good for the long term docs as those young ones forfeit out on their pensions.
It's a good corporate company. We have quite a few Kaiser docs in multiple fields in the family.Comment
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As a soon to be fresh residency graduate and new employee of TPMG, I was hoping you and other current employees could answer some questions.
1) Can you tell me about the 401k? One of the posts above makes it seem like after-tax contributions are possible for backdoor Roth. Do the funds in the 401k have low ER?
Welcome aboard! I’ve been working for TPMG for almost 10 years & I’ll be glad and try to answer some of your questions.
The 401k is through Fidelity. They have a variety of funds to choose from with very low ERs (some funds are 0.00). The funds are commingled trust funds not mutual funds so you can get them less expensively. Yes, you can make after-tax contributions which can be converted in-plan to Roth $ (the mega-backdoor Roth as described by WCI). It’s fairly easy to do (you can do the conversion once per quarter). You can contribute a maximum after-tax (in 2017) of $54,000 – 18,000 – KPs Plan 2 contribution (more on this below). If you make more than 270k, that ends up being $15,360 this year. (if you make less than 270k, you can contribute more after-tax since your Plan 2 money from KP will be less).
2) The DCP everyone referenced, is that the “Plan 2″? If so, how are people obtaining 7 figure balances, even if your salary maxes out at the IRS compensation limit (~270k right?) that only works out to about $20k/year.
No, as FLP pointed out above Plan 2 is different than the DCP. Plan 2 is the KP equivalent of an employer match… other than they aren’t matching anything, just giving you the money straight up. The amount is based on your salary. They give each physician 5% up to the social security wage base and then 10% of the difference between the annual compensation limit (270k this year) and the social security wage base. If I did the math correctly, KP will give physicians making over 270k $20,640 this year. This money is not yours right away. There is a vesting process over 5 years. The DCP (or deferred compensation) is completely separate from the 401k. I’ve been putting a bit away in this the past couple of years, but it’s a complicated plan (strict limits on when and how you can get the money back) and it is a non-qualified plan (so extra risk there).
3) What is meant by ” then you have to take that ugly lump sum makeup payment from the supplemental plan at age 65″. Is the supplemental plan, Plan 1?
Plan 1 is the pension plan. The general rules are laid out by FLP up at the top of this thread (2% per year of the first 20 years, etc). After that it gets a bit complicated. If you make less than the compensation limit, the lump sum payment doesn’t apply. If you make more than this amount, your pension is divided into two parts (starting at age 65… it is different from ages 60-65). The two parts are the pension part (payments in any number of different ways) which is based on the compensation limit times your pension percentage (example if you worked for 20 years, 40% times the compensation limit). The second part of the pension is the lump sum (given the month after your turn 65, assuming you are retired at that point). Let’s say your average salary of your 3 highest years is 100k over the compensation limit. TPMG will give you a lump sum to make up for the fact that 100k is not reflected in the monthly pension payments. (it ends up being two lump sums, one being a gift from TPMG to help deal with the potentially very expensive tax bill that comes along with the first lump sum. Apparently you can’t avoid paying taxes including CA state taxes on this regardless of where you are living at the time of the payment). Confused yet?
4) You wrote “Kaiser eats their young”, can you tell me more about what leads to the high initial attrition? I’m hoping to avoid that outcome, so I want to go in with realistic expectations.
KP has been a reasonably fine place for me to practice. Most days I find things very reasonable. I have more time to spend with my family than I did when I was in my previous private practice. Of course on some days, it doesn’t feel reasonable at all… Remember this is a huge organization with variation from medical center to medical center and department to department. Some department chiefs are fantastic and some are not. Some departments foster a sense of collaboration and some do not. I know from my regional work that these variations can be enormous within the same specialty.
A new CEO will be starting this summer. The changes from this transition may be little and hardly felt or may be the start of a massive shift in the lives of the TPMG physicians. We’ll find out soon enough.
OK, if you’re still reading, I hope you find this helpful.
WW
This. I worked at TPMG for nearly 2 years and my department had one of those chiefs who was not "fantastic". I left for that (and several other) reasons. That was the right decision for me. I found working at TPMG as a physician mentally taxing. Everyone but you is in the union, etc. But to each it's own, of course.Comment
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Some clarification: The 401k funds can be invested in several ways. You can manage them yourself through Fidelity, at no extra cost ( your only cost is the expense ratio of the fund you invest in, just as if you bought them through your own account.) You can also buy anything else through Fidelity using those funds. However, you can also invest directly in the 401k, without transferring the funds to a Fidelity 401k. I don't have all the funds in front of me, but these include a total market index fund by Blackrock that has an ER of around 2 basis points- better than Vanguard or Fidelity. They also have a number of target date funds, also with low ERs. You can't invest for less anywhere else.
The ugly lump sum that was described comes in as follows: You are entitled to a pension that gives you 2% for each of the first 20 years, and 1% thereafter. Lets assume a salary of 500k after 30 years. So, you should get 250k per year as pension. When you retire at age 60, you will indeed get 250k paid out as a monthly salary, but ONLY until age 65. This is because the pension from 60-65 is an IRS "non-qualified" pension. At age 65, you start to get the "qualified" pension. This is limited to the IRS maximum, around 270k. So you will only get a monthly pension based on 270k per year. So now you are owed a pension based on the balance of your salary, which is 500k-270k= 230k. This is given to you at age 65 as a lump sum payout of around 1.5 million. They add around 150k to this to help a bit with the taxes. This entire 1.65 million is taxed as income, which will cost you a bit over 50%. There's no way to avoid getting this balance as a lump sum and paying the tax. However, the qualified portion of the pension can be taken in a number of different ways ( around 10 options, I think ).
Most days I find things very reasonable. I have more time to spend with my family than I did when I was in my previous private practice. Of course on some days, it doesn’t feel reasonable at all… Remember this is a huge organization with variation from medical center to medical center and department to department. Some department chiefs are fantastic and some are not. Some departments foster a sense of collaboration and some do not. I know from my regional work that these variations can be enormous within the same specialty.
WallyWorld described the downsides well. Each department is different, each facility is different, and clinical responsibilities can vary wildly from one facility to another. The same specialty might have a brutal call schedule in one hospital, and almost none in another, depending on the scope of practice vs other specialties at that facility, the size of the department, etc. The PIC ( hospital chief ) might be pleasant and benign, or a sociopath. The same goes for your department or division chief, and your colleagues, for that matter.
For every plus there's a minus. eg You don't have to deal with insurance companies, so that administrative hassle is gone. However, you also have to jump through other hoops, such as sending each pt a post visit email. Your bonus ( around 10-20k ) is based on evaluations by your dept chief, patients, and many other metrics ( did you send all those post visit emails, show up on time to meetings , etc ). You have medical assistants that you don't have to hire, but you also can't fire them. You don't have control over your schedule. In surgery departments, docs could only book consults. Return visits were all forced onto the schedule. Any new patient wanting to be seen that day had to be seen, regardless of urgency.
Again, if you have a benign atmosphere, it can be great. If not, it's a living ************************. Each department is very different.
The "eat your young" comment is really from the 1980's and early 90's. back then, starting salaries were very low, but steadily rose, so you earned very little your first 10 years, but by the time you retired, you were making huge salaries, far above the norm, which would be reflected in your pension. However, salaries were adjusted in the 90's and now the starting salaries are fairly generous.
I worked at TPMG for nearly 2 years and my department had one of those chiefs who was not “fantastic”. I left for that (and several other) reasons. That was the right decision for me. I found working at TPMG as a physician mentally taxing. Everyone but you is in the union, etc. But to each it’s own, of course.
Very well put. "mentally taxing". I like that. Yes, everyone but you is in the union. Exactly.
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So true about variances between sites -- one way to assess your site if its been around for years --- appropriate laddering of physicians. It a bunch of <5 year folk and a large gap between 10-20 years in the clinic, you will have to wonder and should be inquiring why that is.Comment
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The biggest problem is trying to tailor your practice to the types of cases you want to see. There are regional targets for patient access and doctor productivity that need to be met or the hospital chief won't get his/ her bonus, nor with the department chief, or the rank and file, for that matter. This means that your day to day options can be severely impacted.
Perhaps you're in ortho with a fellowship in total joints. Maybe you only want to do knees, or shoulders. You may still have to take trauma call until the day you retire. If the department needs you to do the bread and butter cases, that's what you'll do. Maybe you aren't comfortable doing hand. You will still have to cover hand trauma while on call.
When you want to cut back at age 50 or so, you might be able to cut down to 3 days a week, but you still won't be able to spend more time with patients, or stop taking call. Sure, some departments might let you do it if you're friends with the chief, or maybe if you are the chief. But in most cases you will have to work just like the new guy until the day you retire or quit.Comment
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When you want to cut back at age 50 or so, you might be able to cut down to 3 days a week, but you still won’t be able to spend more time with patients, or stop taking call. Sure, some departments might let you do it if you’re friends with the chief, or maybe if you are the chief. But in most cases you will have to work just like the new guy until the day you retire or quit.
True. There's not much differentiation in salary or workload between the guy who joined last week and the guy who has been there for 30 years. That's one of the benefits IMO. One of the greatest dangers in any private practice are the dinosaurs who want to keep drawing fat paychecks while doing less and less work. As the new guy, I'm happy to take their calls as long as they compensate me appropriately.Comment
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I've talked to numerous KP physicians over the years. TPMG seems to be the least physician friendly group, but most efficient from corporate standpoint. I've spoken to several chiefs from SCPMG, Hawaii, Oregon- all mentioned to me that the "corporate goal is to emulate TPMG efficiency". SCPMG seems to be the most physician friendly. They have 1/2 day per week admin time (they tried to eliminate this for years, but unsuccessful so far). Oregon 1 FTE is 4 days/week I believe (correct me if I am wrong). SCPMG is also a partnership, so after you become a partner (3 years) you get k1. At TPMG you are a W2 employee forever (it's a C corp). Salaries on the other hand tend to be ~20-25% lower at SCPMG.Comment
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Disagree, I think the benefits at tpmg are far more generous than scpmg.Comment
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I didn't say anything about difference in benefits. I'd take 36 hour work week over better benefits any day.Comment
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