SSM Health's pensions do not violate federal rules, judge rules

By Takesha Thomas | Aug 1, 2018

A federal judge threw out a pension-related lawsuit on July 23, ruling a nonprofit hospital with ties to the Roman Catholic Church did not violate retirement plan regulations.

SSM Health, a nonprofit hospital with ties to the Roman Catholic Church, did not violate retirement plan regulations, a judge ruled.  

ST. LOUIS –– A federal judge threw out a pension-related lawsuit on July 23, ruling a nonprofit hospital with ties to the Roman Catholic Church did not violate retirement plan regulations.

Judge Henry Autrey of the U.S. District Court of Eastern Missouri found SSM Health did not violate the Employee Retirement Income Security Act (ERISA) by treating the SSM Pension Plans as exempt church plans.

Plaintiffs Lisa Feather, Stanley Beiermann, and Holly Pyatt brought the complaint against SSM Health in 2016, claiming the hospital system underfunded pension plans. The plaintiffs called the church plan exemption "unconstitutional."

The federal court did not agree. 


Former employees brought the lawsuit over their pensions.  

"The court finds that plaintiffs do not allege an imminent injury," Autrey wrote in the 17-page opinion. "SSM Health's financial statements show that SSM Health has made annual contributions averaging more than $100 million over the past three years and that the plans have sufficient assets to pay benefits for a decade even if these contributions ceased."

"Plaintiffs also argue that they are harmed because the plans are not insured by the Pension Benefit Guarantee Corporation," Autrey wrote. "PBGC insurance only provides a benefit if a plan terminates underfunded, which has not occurred here."

SSM Health, which dates back to 1874, is a tax-exempt, non-profit organization organization. The hospital system was started as the Sisters of Saint Mary until 1982 when the organization became the corporation now known as SSM Health. 

In 2013, SSM Health Ministries, a public juridic person of the Roman Catholic Church, succeeded the Franciscan Sisters of Mary in its role overseeing the health system, according to court documents. 

ERISA regulates plans established or maintained by an employer. ERISA, however, exempts certain plans from its coverage, including church plans, according to court documents. 

This matter is one of dozens of similar cases in which plaintiffs challenge whether a plan sponsored by a religiously affiliated hospital meets the requirements to be a church plan. The U.S. Supreme Court is expected to rule on the matter in a future session.

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