Rinehart v. Life Ins. Co. of North America Slip Copy, 2009 WL 995715 (E.D. Wa. 2009)

Outcome: Long Term Disability Plan not covered by ERISA

Description: U.S. District Court Judge Ronald B. Leighton ruled that a long term disability (LTD) plan sponsored by Providence Health & Services (PH&S) is a "church plan" and that PH&S did not effectively elect to have the LTD Plan Governed by ERISA. This decision has important implications for employees with disabilities at all facilities run by PH&S. PH&S was founded and continues to be sponsored by the Sisters of Providence, a religious order of the Catholic Church. PH&S includes 26 hospitals, more than 35 non-acute facilities, physician clinics, a health plan, a liberal arts university, a high school, approximately 45,000 employees and numerous other health, housing and educational services. The system office is located in Seattle, Washington. The court's decision permitted Mr. Rinehart to pursue his state law claims including breach of the implied covenant of good faith and fair dealing. The decision will undoubtedly be relied upon by other LTD claimants with pending claims.