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Take All Practice Membersí Needs Into Account When Creating a Retirement Plan

Robert E. Tucker, MD, MBA

November 2012
Practice Management

Employer-sponsored retirement plans are an important benefit provided in most medical practices. When the practice employs individuals of varying ages, income levels, and educational backgrounds, the plan must be carefully structured to treat all participants fairly. Recent regulations have added to the record keeping and potentially expose plans to greater scrutiny. Physicians must be aware of the steps they can take to minimize their liability while creating a sound investment environment for all employees. These steps include working with professionals to provide plan design, administration and investment management.

Complying With Regulations
One of the advantages of practicing medicine within the structure of a corporation is the ability to create efficient benefit plans, including retirement plans. However, if the corporation employs individuals other than a single physician, federal regulations mandate that retirement plan provisions be applied fairly across all classes of employees. Complying with these regulations can place an administrative burden on the physician-owner and staff, and can create unexpected sources of liability for those involved in the administration of the plan. Fortunately, steps can be taken to reduce the liability of the plan sponsors by properly structuring and funding the plan, ensuring adequate record keeping, and providing investment opportunities suitable to participants with a broad range of investment knowledge and risk tolerance.

The initial setup of the retirement plan provides the best opportunity to create a fully compliant environment. The advice of a retirement plan consultant is crucial. It can come from an attorney, accountant, or plan administration consultant, but the advisor should be free to recommend the most appropriate model and service providers without potential conflicts of interest. It may also not be best to bundle all of the required services with a single source. While the structure necessarily is based on the desires ....

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