IRS Announces PCOR Fee Adjustment

posted on

IRS Notice 2018-85 provided the updated dollar amount to be used to calculate the PCORI fee for health plan policy and plan years that end on or after October 1, 2018 and before October 1, 2019 This includes 2018 calendar year plans, and the updated fee amount is $2.45 per covered life.

As you may recall the Patient-Centered Outcomes Research Institute (PCORI) was a creation of the Affordable Care Act (ACA) and the fee was first assessed for health plan years ending September 30, 2012 at $1 per covered life and has been indexed in years thereafter. Health insurers for insured health plans and plan sponsors of self-insured health plans are subject to these fees until the sunset of the provision.  The last year for assessment is the 2018 calendar year and will not be assessed for plan year after September 30, 2019.

The PCORI fee is due by July 31st each year. To properly calculate the PCORI fee for self-funded health plans (including Health Reimbursement Arrangements (HRA) and Health Flexible Spending Accounts (FSA) that do not meet the excepted benefit criteria) the employer will need to review IRS Form 720 and IRS Form 720 Instructions each year.  These typically are updated in the spring of the year to reflect the adjusted fee amounts.

Plan years and policy years that end on or after October 1, 2017, and before October 1, 2018 the fee is $2.39.

The amount of the fee paid will vary depending upon when the plan year ends and/or whether or not there has been a change in plan year during 2018.

Plan Years Ending Dates

Fee Per Covered Life due by 7/31/19

Plan years ending on or after October 1, 2018, through December 31, 2018 including calendar years

 

$2.45

Plan years ending on or after January 1, 2019 through September 30, 2019

$2.45

 Please see an earlier Compliance Buzz for additional details.

 

Categories: Health Care Reform, Compliance | Tags: PCOR , PCORI , PCOR Fee , Patient Centered Outcome Research Institute , Form 720 | Return