The Supreme Court’s unanimous decision on June 5, 2017 in Advocate Health Care Network v. Stapleton is a significant victory for church-affiliated hospitals and similar institutions. The opinion reverses three appellate decisions on the matter.

The Court ruled that an employee benefit plan maintained by an organization controlled by or associated with a church with the principal purpose of administering or funding an employee retirement or welfare plan for the employees of a church — such organization being a “principal-purpose organization” — is a “church plan” exempt from the requirements of the Employment Retirement Income Security Act of 1974. This ruling applies to plans that were established by the principal-purpose organization and not directly established by a church.

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