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Issue #39 March 14, 2019
News from the Employee Benefit Research Institute

Future of Employment-Based Health Benefits Unclear

A new study from the Employee Benefit Research Institute (EBRI) assesses how legislative proposals and regulatory actions could impact the future of the employment-based health benefits system. "What Does the Future Hold for the Employment-Based Health Benefits System?" examines the history of employment-based health benefits and the potential impact a variety of legislative proposals and regulatory actions could have on its future. The Cadillac tax, Medicare-for-all, the public plan option, Medicaid and Medicare buy-in, the Trump administration proposal on health reimbursement arrangements — all could result in a dramatic change for the more than 167 million individuals under age 65 who are covered by employment-based health benefits and for the companies who provide benefits to employees.

“Public policies related to the Cadillac tax, Medicare-for-all, and proposals that allow insurance to be purchased in the individual market using employer funding may all affect whether there is an employment-based health benefits system in the future,” said Paul Fronstin, Director of the Health Research and Education Program, EBRI, and author of this report. “Market developments, including the gig economy and high-priced medical advances like specialty medications, can also significantly impact the system.”

Learn more by reading the study.

Picture This: Projected Retirement Deficits Decline Since 2014

Last week EBRI released a study, "Retirement Savings Shortfalls: Evidence From EBRI’s 2019 Retirement Security Projection Model,” projecting retirement deficits for all U.S. households between the ages of 35 and 64. Aggregate deficits have decreased 13.7 percent from $4.44 trillion in 2014 to $3.83 trillion in 2019.  The largest improvement was experienced by younger households, with those ages 35–39 projected to have a 22 percent decrease in their average deficits. EBRI has developed an infographic and a presentation identifying the change in the last five years for aggregate deficits as well as the average retirement deficits by age cohort.
How Much Would It Take? Achieving Retirement Income Equivalency Between Final-Average-Pay Defined Benefit Plan Accruals and Automatic Enrollment 401(k) Plans in the Private Sector
Join us for our next webinar.

A rapidly growing public policy concern facing the United States is whether future generations of retired Americans, particularly those in the Baby Boomer and Gen X cohorts, will have adequate retirement incomes. There have been several policy studies in recent years that suggest that the decreasing relevance of defined benefit (DB) plans relative to defined contribution (DC) plans (such as 401(k) plans) since the 1980s will have a negative impact on the percentage of future retirees who will achieve a specified level of retirement income adequacy.

Previous EBRI research reported on a comparative analysis of future benefits from private-sector, voluntary enrollment (VE) 401(k) plans and stylized, final-average-pay defined benefit plans. This webinar will begin with a presentation by Jack VanDerhei, EBRI research director, that reviews new EBRI research that expands the previous research by computing the actual final-average DB accrual that would be required to provide an equal amount of retirement income at age 65 as would be produced by the annuitized value of the projected sum of the 401(k) and IRA rollover balances under automatic enrollment (AE) 401(k) plans.

However, the choice for employers is not binary. It is not DC versus DB. Rather, those are two end-points on a spectrum of designs that might prove to be a better approach to balance employer and employee needs and concerns. In the second presentation by Stewart D. Lawrence, FSA, Senior Vice President, National Retirement Practice Leader, The Segal Group, we’ll look at that spectrum and focus on a few candidates for finding that middle ground.

  • Date: March 20, 2019
  • Time: 2:00 – 3:00 p.m. Eastern Time
  • Jack VanDerhei, Ph.D, Director of Research, EBRI
  • Stewart D. Lawrence, FSA, Senior Vice President, National Retirement Practice Leader, The Segal Group
  • Moderated by: Lori Lucas, CFA, President and CEO, EBRI
Only EBRI brings together unique and unbiased research, industry thought leaders, and all segments of the employee benefits industry to provide unparalleled programming.  
Register Today for EBRI's May 9th Policy Forum in Washington DC

EBRI’s 85th Policy Forum is scheduled for Thursday, May 9. View the agenda.  Learn about the latest research, trends, and regulatory changes affecting retirement, health care, and financial wellness. Hear from EBRI researchers, policymakers, plan sponsors, and providers as we discuss the impact of today’s public policy environment on employee benefits. Sessions include:
  • Under the Dome – A Closer Look at Legislative Proposals Impacting Retirement
  • The Latest Research and Perspectives on Managing the Cost of Employment-Based Health Benefits
  • Navigating the Financial Wellness Landscape
  • Keynote TBD
Where: 20 F Street NW Conference Center located at 20 F Street, NW (near Union Station) Washington, DC 20001

When: Thursday, May 9 from 8:30 a.m. - 2:00 p.m.
EBRI's Spring 2019 ASEC Symposium
Special Session: Gen X and Retirement
On Tuesday, April 30, join the American Savings Education Council in Washington, DC for a discussion on the retirement prospects of American workers — particularly Generation X. Attitudes and preparations by the cohort will be examined, along with what government agencies are doing to help Americans with their financial and retirement prospects.

Participants in this free half-day event will also have the opportunity to network with industry professionals.

Topics covered include:
  • Results from the 2019 Retirement Confidence Survey: Attitudes and Preparations Towards Retirement, Craig Copeland, Senior Research Associate, EBRI, and Lisa Greenwald, Executive Vice President, Greenwald & Associates
  • Outreach and Tools from Federal Government Agencies for American’s Financial Prospects
  • How are Gen Xers Faring in Retirement Preparations?
    • Retirement Income Adequacy: Who Is Going to Run Short of Money in Retirement and What Can Be Done to Prevent It? Jack VanDerhei, Research Director, EBRI
    • How Do Gen Xer’s Retirement Plan Accumulations Stack Up? A Comparison With Earlier Cohorts, Craig Copeland, Senior Research Associate, EBRI
Location: Morgan Lewis 1111 Pennsylvania Ave NW, Washington, DC 20004
ASEC is a tax-exempt, non-profit program of the EBRI Education and Research Fund, undertaking initiatives to raise public awareness about creating long-term financial independence. ASEC's goal is to make saving and retirement planning a vital concern of all Americans. ASEC does not lobby or take positions on public policy proposals.

Are you interested in aligning your brand with the values of the American Savings Education Council? Consider sponsoring this program.
EBRI Summer Internship Opportunity

EBRI is looking for a summer intern to help us catalog and organize the physical content in our library. This is an excellent opportunity for a college student interested in association work, public policy, and/or employee benefits. Please send a letter of interest and a resume to us by March 31.

On the Road With EBRI

On March 26, Jack VanDerhei will present on Retirement Research You Need to Know at the Retirement Industry Trust Association (RITA) Spring Conference in Washington, DC.

On April 4, Jack VanDerhei will present on Challenges of Retirement in the Future Economy at the LOMA LIMRA Retirement Industry Conference in Baltimore, MD.

On April 6, Jack VanDerhei will present on The Future of Retirement: Predictions & Perspectives at the TheStreet retirement symposium on Retirement, Taxes & Income Strategies in NYC.

On May 1, Jack VanDerhei will present on 
Alternative Realities: Possible Futures for the 401(k) and The Impact on America's Retirements at the PSCA National Conference in Tampa, FL.

On May 7, Paul Fronstin will present on What Does the Future Hold for the Employment-Based Health Benefits System? at the 2019 Boston Mid-Sized Retirement & Healthcare Plan Management Conference in Boston, MA.

Schedule of Events
March 14 - Monthly Public Advisory Council Call (Invitation Only)

March 20 - Achieving Retirement Equivalency Between Final-Average-Pay Defined Benefit Plans and Automatic Enrollment 401(k) Plans in the Private Sector 

April 11 - Monthly Public Advisory Council Call (Invitation Only)

April 29 - Financial Wellbeing Research Center Quarterly Call (Invitation Only)

April 30 - ASEC Spring Symposium: Retirement Confidence Survey Findings on Gen X

May 8 - Research Committee Meeting in Washington, D.C. (Invitation Only)

May 8 - Board of Trustees Meeting in Washington, D.C. (Invitation Only)

May 9 - Policy Forum #85 in Washington, D.C.

June 13 - In Person Public Policy Advisory Council Meeting (Invitation Only)

August 8 - In Person Public Policy Advisory Council Meeting (Invitation Only)
Align Your Brand With the Most Trusted Name in Employee Benefits

Whether your company is looking to build its credibility in the benefits marketplace, establish your brand’s thought leaders, or reach EBRI’s coveted audience, you’ll want to sponsor our in-person and virtual events. Sponsorships are available for upcoming meetings and webinars. Opportunities are limited — please contact Betsy Jaffe to learn more and secure your space today.
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