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PBGC to Pay Pension Benefits for Employees & Retirees at Verity Health System

PBGC to Pay Pension Benefits for Employees & Retirees at Verity Health System
FOR IMMEDIATE RELEASE
October 15, 2019

WASHINGTON — The Pension Benefit Guaranty Corporation (PBGC) is taking steps to assume responsibility for two pension plans sponsored by Verity Health System, which cover nearly 8,000 people. The six-hospital system is based in El Segundo, California.

Verity, with 16 of its affiliates, filed for Chapter 11 protection in the U.S. Bankruptcy Court in Los Angeles on August 31, 2018, and is no longer able to continue its plans.

The Verity Health System Retirement Plan A covers 6,989 people. PBGC estimates Plan A is 52% funded, with underfunding of approximately $306 million. A separate plan, the Verity Health System Retirement Plan B, covers 985 people. PBGC estimates it is 74% funded with underfunding of approximately $2.8 million.

PBGC will pay pension benefits earned by Verity’s current and future retirees up to the legal limits. For more information see Questions and Answers for Participants in the Verity Health System Pension Plans.

About PBGC:

PBGC protects the pension benefits of nearly 37 million Americans in private-sector pension plans. The agency operates two separate insurance programs — one covering pension plans sponsored by a single-employer and another covering multiemployer pension plans, which are sponsored by more than one employer and maintained under collective bargaining agreements. PBGC is currently responsible for the benefits of about 1.5 million people in failed pension plans and receives no taxpayer dollars. PBGC’s Single-Employer Insurance Program is financed by insurance premiums, investment income, and assets and recoveries from failed single-employer plans. For more information, please visit PBGC.gov.

Press Release Number: 
19-11