Sutter Health Invests Hundreds of Millions in Employee Pension
Board Authorizes Half-Billion Dollars if Needed
SACRAMENTO, Calif., November 28, 2008 - In the face of one of the most severe economic downturns ever to face the nation, the Sutter Health Board of Directors has approved an investment of up to a half-billion dollars to fully fund the Sutter Health Retirement Plan. Employee pension plans, which are often heavily invested in stocks and bonds, have been among the biggest casualties of the nation’s worsening economy. Although conservatively invested, the Sutter Health Retirement Plan has not been immune.
In September, the Sutter board approved an investment of about $245 million to keep the Sutter Health Retirement Plan fully funded after the nation’s financial markets plunged. By late October, the still sagging economy caused the value of the plan to drop again, prompting the board to authorize an additional investment of up to $255 million if necessary.
“One of Sutter Health’s longstanding traditions has been to distinguish our organizations not only through a commitment to clinical quality, but by being employers of choice,” said Sutter Health Board Chair Jim Gray. “Many organizations talk about being employers of choice, but Sutter Health is walking the talk by keeping our obligation to the retirement plan a top commitment,” he added. “Now, more than ever, employees need to feel secure about their futures, and we are pleased to be able to make this level of investment.”
While Sutter Health’s Retirement Plan suffered substantial losses as a result of the economic downturn, Gray said that fortunately the plan was fully funded going into the economic slide. Sutter Health’s conservative investment philosophy also helped to minimize losses. “Other organizations whose pension plans were in bad shape at the start of the mid-year economic decline and those that have traditionally pursued more aggressive investment strategies are facing particularly difficult pension challenges,” Gray said.
Within Sutter Health, the pension is a valuable piece of total employee compensation. For example, a service worker hired today by a Sutter affiliate at a starting salary of $38,000 and who retires after 35 years can leave at age 65 with a lump sum of nearly a half-million dollars or a guaranteed income of about $6,400 per month for life.
About Sutter Health
Serving patients and their families in more than 100 Northern California cities and towns, Sutter Health doctors, hospitals and other health care service providers join resources and share expertise to advance health care quality and access. The Sutter Medical Network includes many of California’s top-performing, highest quality physician organizations as measured annually by the Integrated Healthcare Organization. Sutter-affiliated hospitals are regional leaders in cardiac care, women’s and children’s services, cancer care, orthopedics and advanced patient safety technology. For more information about the not-for-profit Sutter Health family, please visit www.sutterhealth.org.
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