Aligning the PBGC’s Single-Employer Premium Structure With Its Objectives

Issue Brief: Aligning the PBGC’s Single-Employer Premium Structure With Its Objectives

The issue brief provides additional information about potential changes that have already been discussed in previous Academy issue briefs and does not advocate for any particular course of action. A nonpartisan organization, the Academy provides an independent and diverse perspective reflecting the collective expertise of its members. The Academy also issued a press release.

It’s important to note this issue brief is intended to help policymakers evaluate various options to address concerns about the PBGC’s current premium structure in the single-employer insurance program. The Academy notes that a combination of changes could result in a significant reduction in premiums, be consistent with the PBGC’s mission, and remove premiums as a significant impediment to the ongoing maintenance of defined benefit plans. The Academy sees value in focusing on the primary objective of quickly and significantly reducing premiums and removing any structural impediments to that objective—namely reforming the way premiums are handled for purposes of congressional budget scoring. It would be entirely consistent with the principles discussed in this issue brief to focus on those objectives, while allowing other system modifications that are more targeted at how premium costs are allocated among plan sponsors to be considered over a longer timeframe.

Read the Issue Brief.