The U.S. Supreme Court has decided to hear the appeals of three church-affiliated hospital systems, including Saint Peter's Healthcare System. All three hospital systems' pension plans were declared ineligible by federal appeals courts for the ERISA exemption for churches. Besides Saint Peter's, the hospital systems are Dignity Health of California, which operates Catholic hospitals, and Advocate Health System of Illinois, affiliated with the Evangelical Lutheran Church in America and United Church of Christ. The cases have been consolidated, so the Court will hear arguments for all three cases together.
It seems strange that the Court would hear these cases when there has been no disagreement at the appellate level that the church exemption applies only to plans established by churches, according to a clear reading of the statute. The Court apparently accepted the argument of the hospitals' lawyers that decisions by the Department of Labor and the IRS which interpreted the statute differently should be given weight similar to the actual wording of the statute.
We will have more soon, but for now, here are three articles on this latest development from The National Law Journal, ABA Journal, and Reuters.
The management of Saint Peter's University Hospital is using the church to exempt itself from the Federal safeguards that protect your retirement plan. For an introduction, see Your Pension At Risk.
