NYT - PBGC's Financial status in question

[JanetM]

this is posted on benefitslink today - last paragraph states the following.

"Many companies enjoyed large pension surpluses during the stock market boom and now have deficits, and some sponsors must now make big contributions to comply with the law. There are fears that if the pension agency raises its premiums for all companies, those with healthier funds will drop out of the system. That would make the agency's finances even worse."

Am curious about how plan sponsor can drop out of PBGC program. Is the author of the article mistaken or is there something to this?

[mwyatt]

Well, it is a reporter speaking (you know those english majors who don't know how to use a calculator), but I think what the person meant is that higher PBGC premiums could be a contributing factor for healthier companies to either a) freeze accruals to avoid variable rate premiums or b) terminate their plans outright. Neither of these outcomes are socially desirable objectives from the participants' point of view.