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Benefits director outlines benefits problems

A UMNS photo by Ronny Perry Rising costs for retiree healthcare benefits are affected by many factors including second career pastors and clergy lifestyles.

June 22, 2006

A UMNS Report
By Neill Caldwell*

As annual conferences struggle with rising costs for retiree healthcare benefits, there are other factors at play in making this issue an even bigger problem, says Don Rogers, executive director of Virginia United Methodist Pensions, Inc.

Rogers, who has experience in financial planning, insurance and benefits administration, has a number of interesting ideas about the growing crisis of benefits for retired pastors in the United Methodist Church. For example, the rising number of second career pastors coming into the connection is having a real impact on retiree benefits, he says.

“When we bring in second career pastors, they’re not getting enough time in the system to accrue benefits. In Virginia we call it the ‘accordion effect.’ People are coming into the system later and retiring earlier.”

Rogers said that as of 2003, the average age of pastors in the Virginia Conference was 52. “That’s the prime year for the start of consumption of healthcare services. With a finite number of dollars, we’re spending to finance the benefits of these second careerists. If we look at retirees and come up short, it’s because we’ve spent money on people with 10 years of service. If you think the Social Security system is bad, this is the Social Security system on steroids.

“Don’t get me wrong… second career pastors provide extremely valuable leadership. But there is a lack of acknowledgement for the problems in our hiring practices.”

Then there’s the fact that the very career of ministry can lead to a number of health problems. Many pastors lead a sedentary lifestyle and many are overweight. Significant numbers are diabetic and have other special health needs.

By nature a United Methodist pastor is also subject to many of the key stress factors in life: job changes, location changes, financial and family pressures. “It creates a much more unhealthy retiree population,” Rogers says. “Only when we address that can we contain healthcare costs.

“Our clergy population as a whole consumes a tremendous amount of mental health benefits as well,” Rogers said. “The industry has walked away from clergy because of that. They say ‘we can’t handle you any more. You’re too expensive.’ Our clergy retirees have among the highest healthcare costs.”

Rogers believes that the training of benefits coordinators within the church needs to be improved. “The conferences which have the greatest problems with healthcare financing are related to the amount of training the person in my position has. You need to have independent people who are more qualified, better trained and are left alone to work for the participants in the plan.”

All annual conferences need to have a mission statement around their pension and benefit plans, Rogers says. “It’s time (the conferences) give their plans the equivalent of a 40,000-mile checkup. Get it off the road for a couple of days and check things out. They need to establish a reserve, to identify their mission, and be intentional about what the expectations are for their benefits directors/administrators.

“We as a denomination have not addressed the aging of the population,” says Rogers.

“The church needs to address this at the conference level, where people know what resources they need.”

*Caldwell is a freelance writer based in High Point, N.C.

News media contact: Linda Green, Nashville, Tenn., (615) 742-5470 or newsdesk@umcom.org.