Aurora Health Care will offer a 403(b) plan to employees, according to The Business Journal of Milwaukee.
Aurora, also the largest health care provider in eastern Wisconsin, cited three reasons for the change:
- The cost of funding a pension plan is unpredictable because it is tied to economic and market factors;
- Pensions were designed for a different time, when employees generally stayed with an employer for 30 or 40 years; and
- An account-based plan such as the one Aurora is providing is more popular with employees because it is more flexible for employees and helps Aurora be more competitive in recruiting and retaining employees.
The pension plan will be frozen as of December 31. Spokesman Mike Brophy told The Business Journal Aurora is not reducing the amount it spends on retirement benefits.