MEPSIM: the Pension Analytics Group's
Multiemployer Pension Simulation Model

The multiemployer pension system is dangerously underfunded. In the absence of significant contribution increases or benefit cuts, many multiemployer plans will become insolvent in the near future. The Pension Benefit Guarantee Corporation (PBGC) -- which insures the benefits of private sector defined benefit plans -- lacks sufficient funds to cover the projected insolvencies. As a consequence, over a million participants of multiemployer plans are projected to lose their pensions.

To assess the magnitude of the funding problem, and to test proposed solutions, this website provides a user-friendly multiemployer pension simulation model which we refer to as "MEPSIM".

There is no fee to use MEPSIM. To use the model, simply click Run a Simulation on the navigation menu above.

Using 5500 data as a starting point, MEPSIM can rapidly simulate either the multiemployer system as a whole, or an individual plan selected by the user. Because MEPSIM's database contains every plan in the multiemployer universe -- as opposed to merely a small sample of plans -- the model's simulations are free of sample bias.

When simulating the multiemployer system as a whole, MEPSIM outputs (1) the stream of projected PBGC assistance payments and its total present value, (2) the projected date of exhaustion of the PBGC's multiemployer guarantee fund, and (3) the PBGC premium increase that would be sufficient to prevent the fund's exhaustion.

When simulating an individual plan, MEPSIM outputs a year-by-year projection of the plan's liabilities, assets, contributions and benefit payments. If the plan is projected to become insolvent, MEPSIM outputs the stream of projected PBGC assistance payments.

MEPSIM can simulate a “no change” scenario in which a plan’s contribution levels and benefit accruals remain constant across time, and can also simulate options for strengthening a plan’s funding position, such as contribution increases, cuts to future benefit accruals, and cuts to benefits that have already been accrued.

In addition to the online version of MEPSIM, we have a desktop version -- with a broader range of features -- that we use for consulting projects. To learn more about this verison, or if you have any questions or suggestions, we can be reached at the email address below.