Company: GEHC
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0001932393-25-000005
Chunk: 196

Company: GE HealthCare Technologies Inc.
Filing Date: 2025-02-13
Form: 10-K
Item: Item 7
Chunk 196
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 3 50 bps decrease in discount rateImpact on PBO/APBO as of December 31, 2024$885 $215 $33 Impact on service cost and interest cost in 2025(43)(3)(2)

The sensitivity of the net deficit to the discount rate would be lower than the projected benefit obligation sensitivity as a result of the liability hedging program incorporated in the plan’s asset allocation.

To determine the expected long-term rate of return on pension plan assets, we consider current and target asset allocations, as well as historical and expected returns on various categories of plan assets. In developing future long-term return expectations for our principal benefit plans’ assets, we formulate views on the future economic environment, both in the U.S. and abroad. We evaluate general market trends and historical relationships among a number of key variables that impact asset class returns such as expected earnings growth, inflation, valuations, yields, and spreads, using both internal and external sources. We also consider expected volatility by asset class and diversification across classes to determine expected overall portfolio results given current and target allocations. A 1% change in the assumed expected long-term rate of return on plan assets would increase or decrease the 2025 net periodic benefit costs of these plans by $194 million.

Our pension plan assets contain financial instruments that are measured at fair value. While the majority of these assets are valued based on quoted prices for identical or similar instruments in active markets, the fair value of certain assets is estimated using significant unobservable inputs (Level 3). These assets primarily relate to real estate and private equity investments.

For pension benefits and retiree health and life benefits transferred from GE on January 1, 2023, third-party actuaries were engaged to assist in the valuation of transferred pension assets and liabilities using assumptions provided by GE which the Company reviewed prior to recording amounts in our combined financial statements.

We disclose in the following table postretirement plans with assets or obligations that exceed $50 million as of December 31, 2024. Refer to Note 10, “Postretirement Benefit Plans” for further details related to these plans. The value of the assets and liabilities as of December 31, 2024, are summarized in the table below.

Projected benefit obligationsFair value of plan assetsFunded status - surplus (deficit)GE HealthCare Pension Plan$15,230 $13,650 $(1,580)GE HealthCare Supplementary Pension Plan1,886 — (1,886)