• “They are always there!”
     H. Meisl, MD
     California Emergency Physicians

 

 

 

Large Group Physicians

Groups of More than 50

MedAmerica Financial Services, Inc. can increase the level of benefits to your physicians without substantially increasing the cost to the physician group.  The plans allow your physicians and employees to increase the level of their contributions and reduce their annual tax liability.   They meet all regulatory requirements and can even help you retain physicians and aid in your recruiting process.  So how do the plans work?…

PLAN HISTORY

In 1988, California Emergency Physicians, then a group of about 200 physicians, looked to establish a retirement plan that provided greater benefits than traditional retirement plans.  At the time, most retirement plans limited contributions to about $9,000 annually.  The design would appeal to its physician partners by permitting maximum savings, increased tax benefits, and total investment flexibility, while limiting the cost to the physician group as a whole.  With a whole lot of input from actuaries and attorneys, California Emergency Physicians designed a plan that became the basis for MedAmerica Financial Services plan design and administration.  Eventually, two plans, a 401(k) and a defined benefit plan, were established that permitted physicians to shelter $40,000 per year, over $30,000 higher than traditional plans.  The new plan design, which was approved by the Internal Revenue Service, allowed some physicians to reduce their tax liability by $10,000 per year!

Since then, the plan has been amended, adjusted and tweaked to provide physician groups with a plan optimally designed to appeal to hospital based physicians.   Because of their size, hospital based physician groups with 50 or more physicians possess greater complexity than smaller physician groups but generate economies of scale that permit the group to save on the services they purchase.  Large groups generally possess non-physician employees, have a higher turnover rate than smaller groups, and work in multiple locations.  MedAmerica Financial Services, along with their partners Schwab Retirement Plan Services, JP Morgan Consulting Actuaries, and Morrison & Foerster have adapted the plans to different structures (Corporation / Partnership / LLC / LLP) and currently administers 5 large group plans and 9 small group plans totalling over $500 million in assets and nearly 3000 participants.

Profit Sharing 401(k) Plan Design

  • 20% contributions to a maximum of $49,000 (adjusted for inflation)
  • Eleven plan sponsored mutual fund options or access to a self directed account that includes stocks, bonds, and mutual funds.  (Sorry, no art, jewelry, limited partnerships or investments in coca manufacturing plants.)
  • Loans, including tax deductible trust deed loans, up to $50K
  • Internet Access to individual account via www.schwabplan.com
  • Catch up provisions for participants over age 50
  • Quarterly statements showing contributions, earnings & personal performance
  • Eligibility requirements, matching provisions for non-physicians, profit sharing provisions, and mutual fund options are determined by the physician group.

Defined Benefit Plan Design

  • Eligibility for all physicians who have worked 18 months for the physician group (Grandfather provision applies for new groups.)
  • Required annual contribution of $2,500 for each eligible physician
  • Optional contributions of three separate scheduled amounts to be determined by group (i.e. $5,000, $15,000 & $30,000) are permitted
  • No Loans permitted
  • Actuarial computed balances published annually each April
  • Moderate Investment allocations established by Medamerica Retirement & Benefits Committee.  (Approximately 50% fixed investments / 50% equity investments)

Regulatory Services provided for both plans

  • Quarterly investment review completed by Retirement and Benefits Committee, in an attempt to provide funds performing in upper quartile of their respective style.
  • Fiduciary Requirements such as periodic committee meetings, written investment policy, and annual audits all provided for each group plan
  • Annual Filing of IRS Form 5500 for each group plan
  • In the event of IRS or DOL plan audit (a normal occurrence that occurs every seven years), MedAmerica Financial Services will act as primary liaison with examiner
  • MedAmerica Financial Services amends and updates all plans to comply with any future regulatory changes

Contact Chris Renner at (800) 842-2808 or at rennerc@medamerica.com and find out how easy it is to implement these comprehensive retirement plans.

 

 

 

 

 

 

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