In Medina v. Catholic Health Initiatives , (10th Cir., Dec. 19, 2017), the U.S. 10th Circuit Court of Appeals held that Catholic Health Initiatives retirement plan for employees of 92 hospitals qualifies as a “church plan” under ERISA. One of the issues in the case was resolved by the Supreme Court while this appeal was pending. Resolving the other issues, the 10th Circuit held that CHI’s internal benefits committee qualifies as the statutorily required organization associated with a church that maintains a retirement plan. The Court went on to conclude that the “church plan” exemption does not violate the Establishment Clause. It held that the exemption meets all three prongs of the Lemon test. Rejecting the argument that the exemption has the effect of favoring religion, the Court said in part: Any law of general applicability that exempts religious organizations from its requirements could be said to convey a message that religion is favored. Religion is, after all, being exempted from a rule everyone else has to follow. Such an approach would mean that Congress could never exempt religious organizations from laws that might burden them—even when burdening religious organizations would itself run afoul of the Constitution. But this is common practice. A number of statutes regulate wide swathes of the American economy. And many of these statutes expressly exempt religious organizations from various requirements.
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