Hospitals' billion-dollar pension dispute heads to Supreme Court

The U.S. Supreme Court agreed on Friday to take up appeals filed by Christian-affiliated hospital systems that are accused of underfunding their employee pension plans.

In the three lawsuits, which were consolidated into one case, the high court will decide whether the health systems can rely on their church affiliations to avoid complying with the federal Employee Retirement Income Security Act, which requires pension plans to have adequate funding to pay their promised benefits.

The lower courts said each of the three hospital systems — Saint Peter's HealthCare System in New Brunswick, N.J., Dignity Health in San Francisco and Advocate Health Care in Downers Grove, Ill. — misclassified their pensions as "church plans" exempt from ERISA.

Employees argue in all three of the lawsuits that the hospital networks are putting their pensions at risk by claiming the ERISA exemption. Saint Peter's, Dignity and Advocate argue they are exempt from the federal pension law and deny their pensions are underfunded.

According to Bloomberg BNA, the lawsuits are among more than 24 cases involving religiously affiliated hospitals' pensions filed in the the past three years. In all, the lawsuits claim the hospitals have underfunded their pensions by a combined $4 billion.

More articles on healthcare industry lawsuits:

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