Former participants in a retirement plan run by Mass General Brigham Inc., Boston, have sued the health-care system and plan fiduciaries alleging ERISA violations in a 403(b) plan ranging from excessive costs to inadequate monitoring of investment fees and performance.
They accused the defendants of "failing to objectively and adequately review the plan's investment portfolio with due care to ensure that each investment option was prudent, in terms of cost; and failing to control the plan's record-keeping cost," in a complaint filed Jan. 13 in a U.S. District Court in Boston.
Mass General Brigham Inc. is the parent organization of five Massachusetts hospitals, including Massachusetts General Hospital, and Brigham and Women's Hospital. Spokesman Timothy Sullivan declined to comment.
The plaintiffs are seeking class-action status covering participants in the 403(b) plan starting Jan. 13, 2016. The complaint said more than 100,000 participants had account balances as of Sept. 30, 2020.
"Their actions were contrary to actions of a reasonable fiduciary and cost the plan and its participants millions of dollars," said the complaint in Norton et al. vs. Mass General Brigham Inc. et al.
"Defendants' failure to obtain reasonably priced investments during the class period is circumstantial evidence of their imprudent process to review and control the plan's costs," the complaint said.
The plaintiffs also contended that "there is little to suggest that defendants conducted an appropriate RFP at reasonable intervals — or certainly at any time prior to 2016 through the present — to determine whether the plan could obtain better record keeping and administrative fee pricing from other service providers."
Consolidated 403(b) Program of Mass General Brigham and Member Organizations had assets of $10.3 billion as of Sept. 30, 2020, according to the latest Form 5500.