PCORI Fee Payments due by July 31, 2014

Type:  General 

The Affordable Care Act (ACA) established the Patient Centered Outcomes Research Institute (PCORI) as a private, nonprofit corporation to advance comparative clinical effectiveness research and to make available the findings of this research to assist patients, clinicians and health care policy makers in making informed health decisions.  Comparative effectiveness research focuses on clinical effectiveness and health outcomes. It does NOT focus on cost effectiveness.

 

In addition, the ACA added a new section to the Internal Revenue Code to establish the PCORI Trust Fund as the funding source for the PCORI and additional new sections to impose fees on health insurers and self-insured health plan sponsors to finance the PCORI Trust Fund:

 

 Patient Centered Outcomes Research Institute (PCORI) Trust Fund Fees:

  • * This program began in 2012 and will run for seven years into 2019.
  • * The aggregate estimated cost to Group Health Plans over the seven years is $3.4 billion.
  • * If an HRA is linked, or integrated, to an insured health plan, then the employer sponsor will pay the fee for the HRA and the insurer will pay for the insured plan - two fees will be collected.
  • * The fee affects plans which have a plan year end date on, or after, October 1, 2012 and prior to October 1 2019.
  • * Payment is due annually by July 31 of the calendar year immediately following the last day of the plan year. So for plan years ending between January 1, 2013 and December 31, 2013, the form must be filed (and the fee paid) by July 31, 2014. 

  

Fee Amounts are also based on the Plan Year End Date:

  • Ending October 1, 2012 - September 30, 2013, the fee is $1 per covered life
  • Ending October 1, 2013 - September 30, 2014, the fee is $2 per covered life
  • Ending October 1, 2014 - September 30, 2019, fee yet to be determined
  • On or after October 1, 2019, the fee no longer applies

 

Remitting the PCORI Fee:

    

You will not be invoiced for the PCORI Fee. You are required to file federal excise tax return Form 720 along with related payment voucher Form 720-V.  In addition, instructions are available on how to fill out the form and calculate the fee. 

  

Third-party administrators are prohibited under the health reform law from remitting the fee on your behalf.

 

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