Sponsoring Both ERISA & Church Plans

[Guest Don Jones]

Can a church affiliated health system which currently sponsors plans recognized by the IRS as church plans also sponsor ERISA plans for use in affiliated organizations that do not qualify for church plan usage?

[Guest Danny Miller]

Due to the manner in which a church affiliated health care system is required to administer its plans in order to obtain church plan status, I believe it is possible to create some plans which are church plans and others which are not (for example, by destroying the requisite control over the committee that administers a particular plan, causing it not to be a section 414(e)(3)(A) organization. Or, I believe it is possible for a church affiliated employer to make a section 410(d) election on less than all of its plans to ensure that a particular plan is covered by ERISA. An issue which must be considered, however, is whether the assets of a church plan can be commingled with the assets of a non-church plan for investment purposes (if plan investments are made in a pooled arrangement), without destroying the church plan status of the former plan. I haven't looked at this issue in some time, but I believe there is at least one DOL advisory opinion on the point. Hope this is helpful.

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Danny Miller

Conner & Winters

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(202) 783-5711

dmiller@cwlaw.com