Southern California Physician Benefits in Brief
Retirement |
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Common Plan
The Common Plan is officially known as The Retirement Plan for Physicians
Serving Members of Kaiser Foundation Health Plan. It is a non-qualified
defined benefit plan. The Common Plan is designed to provide eligible
physicians with a monthly retirement income. To be eligible to receive
benefits, a physician must have at least 10 years of Qualifying Service.
The amount of the benefit is based on the formula described on this
page.
There are two types of service that affect the Common Plan:
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- Qualifying Service is time counted to determine if a
physician is eligible for benefits. It includes both full-time
and part-time service.
- Credited Service is time counted to determine the amount
of retirement income. It is generally computed the same as Qualifying
Service but is prorated to the physician's work schedule. For
example, if a physician works an 8/10ths work schedule for 10
years, s/he would have 10 years of Qualifying Service, but only
8 years of Credited Service.
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| In addition to Credited Service, a physician's Highest
Average Compensation (HAC) is also used in the calculation of
the benefit. HAC is defined as the average monthly compensation: |
- for the 36 consecutive calendar months
- for which the physician had the greatest total rates of base
compensation
- during the last 120 months that the physician provided medical
services to Health Plan members.
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| The formula for determining the amount of retirement
income is: |
2 percent x HAC x Years of Credited Service (up
to 20 yrs)
+
1 percent x HAC x Years of Credited Service (over 20 yrs) |
This formula determines the amount of the payment a physician will
receive if s/he begins receiving payments at age 65 and takes a
monthly retirement income for the remainder of his/her life.
For example, the benefit amount for an age 65 physician would be
calculated as follows: |
Highest Average Compensation: $10,000
Credited Service: 30 years
(2 percent x $10,000 x 20 years) + (1 percent x $10,000 x 10 years)
= $5,000 per month
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The amount of the payment will be actuarially adjusted
if a physician begins payment before or after age 65 and/or selects
a payment option other than lifetime monthly payments. There are a
variety of payment options available upon retirement: Life Only, Joint
Retirement Income, Fixed Period, and Installments. A Lump Sum payment
is not available under this plan.
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