As health systems grow through acquisition and affiliation, benefit complexity can hurt the employee experience and organizational efficiency. We partnered with a 17,000-employee health system to create a unified, systemwide retirement program that reduced fiduciary risk and administrative costs and better supported employee retirement readiness and financial resilience.
The challenge: Multiple retirement plans create post-merger inefficiency
After multiple acquisitions, our client struggled to integrate its fragmented collection of retirement programs. The organization had seven qualified 401(a) and 403(b) defined contribution plans across five recordkeepers and five 457(b) plans supported by four different providers. Each plan carried its own benefit levels, funding approaches and administrative practices.
These variations created benefit inequities within the system and increased fiduciary risk. Differences in plan design, investment lineups and fees made oversight complex and resource-intensive while managing multiple providers limited efficiency and detracted from strategic priorities.
The solution: Consolidating many retirement plans into few
Teaming with the health system, we designed a harmonized retirement program aligned to its principles and financial objectives. We focused on aligning benefits wherever possible while respecting the financial constraints of individual system members.
Our WTW team:
- Helped standardize core and matching benefits to ensure similar benefit mixes
- Aligned savings options and other plan features to promote consistency and program clarity while easing administrative efforts
- Merged plans to streamline operations, where possible
- Aligned and upgraded the investment lineup and fee structures to improve efficiency and reduce fiduciary risk
- Moved to a single recordkeeper to unlock economies of scale, simplify governance and create a more cohesive operating model
The results: Improved employee experience and reduced fiduciary risk
The harmonized retirement program significantly improved the health system’s employee experience with its retirement programs. The consistent design shows system unity, supports inter-system transfers and provides a scalable framework for future hospital affiliations.
From a governance perspective, systemwide alignment of investments and fees meaningfully reduced fiduciary risk. Consolidated administration reduced the effort and cost required to manage the program, enabling oversight by a smaller, more specialized internal team.
The financial impact was substantial. The health system and its employees saved more than $1 million a year in administrative and investment fees, with reduced fiduciary risk thanks to centralized internal oversight. Together, these outcomes created a more resilient, efficient and employee-centered retirement program built to support continued growth.
