In their 2017 ruling on the original Kaplan v. Saint Peter's Healthcare System lawsuit, the Supreme Court reversed an earlier appeals court ruling and decided that ERISA's church plan exemption "applies to plans that are maintained by church-affiliated organizations whose principal purpose is to administer or fund the plans, even when those plans haven’t been established by a church." (Quote from Cohen Milstein update cited below.) However, in August 2018, litigant Larry Kaplan filed an amended complaint, with a particular focus on the increased risk of default brought on by Saint Peter's declaration of church plan status, underfunding the Plan by $130 million and ceasing PBGC insurance coverage after thirty years of operating as an ERISA plan. On April 30, U.S. District Judge Michael A. Shipp denied Saint Peter's motion to dismiss, allowing the suit to proceed. The amended lawsuit is very much alive.
As a reminder of what can (and often does) happen when church hospitals mismanage and abandon their retirement plans, here's the Star Ledger/NJ.com's Karin Price Mueller on a lawsuit filed in state court by retirees of now-closed St. James Hospital against the Newark Archdiocese, for raiding their retirement plan and allowing it to fail. The archdiocese claims that when the hospital was sold in 2008, responsibility for the plan passed to no one. As Saint Peter's recent targeted refurbishments hint that the hospital may be seeking a buyer or merger, we worry that a similar fate could befall Saint Peter's pension plan.