They worked at a Catholic hospital for decades. Then it took away their pension

[ProVobis]

https://www.cnbc.com/2020/02/13/distressed-pension-funds-could-take-away-benefits-for-hospital-workers.html

 

[silentwitness]

From the article:

Federal retirement law typically puts a backstop in place to prevent this sort of doomsday financial scenario for retirees and near-retirees.

However, St. Clare’s was affiliated with the Roman Catholic Church. Its pension, and those of other nonprofits throughout the U.S. with ties to religious entities, are beholden to different rules that could ultimately leave people empty-handed or with reduced benefits.

Also:

The Employee Retirement Income Security Act, a federal law, requires private-sector companies offering pensions to pay annual insurance premiums to the Pension Benefit Guaranty Corporation, which steps in to pay monthly benefits to retirees (up to a maximum amount) if a company can no longer make its promised payments.

The PBGC paid monthly benefits to more than 932,000 retirees in around 4,900 pension plans during the federal government’s last fiscal year.

The federal law, however, doesn’t apply to “church plans” — meaning they don’t have an insurance backstop in the event their pension goes belly up.

and

In 2017, the Supreme Court delivered a blow to workers in a similar situation to those at St. Clare’s. While such pension plans weren’t directly established by a church, the high court ruled that they are still considered “church plans” exempt from ERISA’s protections.

I am assuming the ‘church’ pension plans were not paying premiums to the PBGC. If so this is very bad practice.

I also suspect the pension plans while 'affiliated with the Diocese are not overseen and run by the Diocese as part of the church’s policy of divestment of Catholic education and medical institutions. I think this divestment of Catholic assets has been a very backward step for the church and now it looks like a bad situation for the former workers at this hospital.

 

[Annie]

I am assuming the ‘church’ pension plans were not paying premiums to the PBGC. If so this is very bad practice.

I wondered about that myself.

Also, how can a medical organization go broke?