Singing River Health System is facing a class action lawsuit filed by five retirees and employee over the Jackson County public hospital's decision to end its pension plan. As MPB's Evelina Burnett reports, the situation is a stark reminder of the changing times many Mississippians face as they look toward retirement.
Singing River hasn’t paid into its pension fund for four years. A Singing River spokesman says the hospital's financial woes include what he calls an “auditing mistake” that underestimated past unpaid bills by $88 million, and continuing high unpaid bills, in part due to the state not expanding Medicaid.
Trudy Nelson, who is not part of the class action lawsuit but says she is considering legal action, worked for Singing River for 23 years. She’s not drawing a pension yet, but says there'd be an immediate impact for her 73-year-old mother, a Singing River retiree.
"She's in the same boat as a lot of other retirees - she has to have that retirement to live," she says. "With the cost of prescriptions and just your basic living costs, they're not going to be able to make it without their retirement."
Singing River wants to end its current defined-benefit pension plan, offer employees a reduced-benefit plan, and liquidate and distribute pension funds to retirees.
Elder law attorney Richard Courtney, with Frascogna Courtney in Jackson, says the move away from defined benefit pensions is becoming more common as people work and live longer. Singing River’s pension fund reportedly has about $140 million in it - but needs twice that to be solvent.
"One of the focuses for cost-cutting for a lot of businesses and industries is the retirement plan, because there is so much money there, and the gap is so large," he says.