Health-care plans adapt to reassure participants amid COVID-19

Health-care professionals were given a helping hand with their finances at the height of the COVID-19 pandemic, as executives running their retirement plans recognized the need for extra support.

Pensions & Investments brought together three retirement executives for a webinar Tuesday, as part of the lead-up to the WorldPensionSummit 2021, to consider the measures health-care-related retirement providers took over the past year or so to ensure participants were well supported and provided for as they battled on the front line. Expanded support ranged from ensuring participant well-being to changing plan design.

Executives at the Healthcare of Ontario Pension Plan, Toronto, were able to "deliver some peace of mind for our members" through changes to plan design, said Steve McCormick, senior vice president, plan operations. Executives at the plan, which had C$104 billion ($81.4 billion) in assets as of Dec. 31, realized that "even in health care, there were certain roles that were being furloughed ... and we wanted to do something to address that group," he said.

HOOPP already had a provision in place that allowed participants on health-related leave to continue to accrue benefits without making any contribution. "This has always been an important feature of our plan in the health-care sector — we really want to have empathy for individuals."

Staff and the plan's board came together to adjust that provision, meaning anyone enrolled in the plan who was furloughed as a result of the pandemic or lockdown had the benefit extended to them, "so that those individuals who were not able to work during that period of time would at least have some peace of mind ... from a retirement security position," Mr. McCormick said.

The plan itself went into the pandemic with a surplus and also ended 2020 with a surplus — with a 119% funding ratio as of Dec. 31.

Executives were then able to approve an improvement in benefits for active participants in the plan. Effective April 1, active participants received an increase in their benefits for contributory service in 2018, 2019 and/or 2020, with an increase of up to C$426, according to the plan's website.

In Australia, the government in March allowed certain participants to withdraw A$20,000 ($15,406) from superannuation funds.

"That was very complex for us," said Debby Blakey, CEO at the A$60 billion HESTA, Melbourne.

The government gave participants access to personal liquidity through the move and the lump sum was also tax-free.

"We didn't have mechanisms for payments to all ages to be tax-free. So it was amazing – in a matter of three weeks we had to make a significant number of system changes," working with the Australian Taxation Office.

At the same time, HESTA executives were "dealing with the communications to members, dealing with the market volatility, the stress testing, the daily liquidity testing of our portfolios," Ms. Blakey said.

Call volumes to HESTA were already up, but once the extra COVID-19-related access to super funds was granted, call volumes became "huge" and longer in terms of the length of conversations. Ultimately, 160,000 participants accessed their HESTA plan early, she said.

In the Netherlands, Pensioenfonds Zorg en Welzijn, Zeist, executives heard about a support fund that had been set up by volunteers, which helped health-care workers and their families who had been affected by the pandemic.

"We found out that we could support that fund — of course, we could only do it in very small ways with money — but we ... have taken over their back office," said Joanne Kellerman, chairwoman. "We do their admin work with volunteers from our offices, which was ... a very direct way of helping out. It created connections within the various sectors that we represent, but also I hope between us as pension professionals and health workers."

PFZW has €238 billion ($288.2 billion) in assets and is managed by in-house firm PGGM.

PFZW executives also worked to come up with ideas of what it could do to support participants. It launched a new part of the website, translated roughly as "conquer your stress," which pointed out to participants how to deal with stress, recharge and take breaks — probably something executives would not have done in "normal times."