PCORI Fee Deadline of July 31, 2020 is Quickly Approaching

The July 31, 2020 fee deadline for the Patient-Centered Outcomes Reseach Institute (“PCORI”) is quickly approaching. The payment due on July 31st 2020, covers the plan year for the previous calendar year, see schedule below. The IRS released  Notice 2020-44 on June 8, 2020.  In this notice, a revised applicable rate was increased from $2.45 to $2.54 for plan sponsors and self-insured health insurance polices.  The increased rate should be used to calculate the fee for plans within the time frame between October 1, 2019 and before October 1, 2020.  The PCORI fee was established under the Affordable Care Act (“ACA”) to fund research, helping physicians, policy makers and patients, make informed healthcare decisions based on evidence-based medicine.  

The PCORI fee has been extended to either 2029 or 2030, an additional 10 years, depending on the plan end date, with the enactment of the 2020 Further Consolidated Appropriations Act. Originally under the ACA, they were set to expire for plan years ending after September 30, 2019.  The fees are reported annually on the second quarter IRS Form 720 by self-funded plan employers directly. The fee is calculated by multiplying the average number of covered lives under the plan or policy by the applicable rate. In addition to the rate increase, the notice also offers transition relief for companies that were not expecting the fees to be collected.  Transition relief applies to plan years ending between October 1, 2019 and October 1, 2020. The IRS is allowing plan sponsors and self-insured companies to use any “reasonable method” to calculate fees.  Employers with fully funded health plans are not required to file, at this time, as insurance carriers are paying PCORI fees and pass the cost on to the employer.

Now more than ever, it is prudent for businesses to utilize certified professionals and robust solutions for their ACA reporting needs. Contact SPSGZ to learn more about ACA compliance, click here.  

PCORI PAYMENT SCHEDULE

PLAN YEARPAYMENT AMOUNTDUE DATE
February 1, 2018 – January 31, 2019$2.45July 31st 2020
March 1, 2018 – February 28, 2019$2.45July 31st 2020
April 1, 2018 – March 31, 2019$2.45July 31st 2020
May 1, 2018 – April 30, 2019$2.45July 31st 2020
June 1, 2018 – May 31, 2019$2.45July 31st 2020
July 1, 2018 – June 30, 2019$2.45July 31st 2020
August 1, 2018 – July 31, 2019$2.45July 31st 2020
September 1, 2018 – August 31, 2019$2.45July 31st 2020
October 1, 2018 – September 30, 2019$2.45July 31st 2020
November 1, 2018 – October 31, 2019$2.54July 31st 2020
December 1, 2018 – November 30, 2019$2.54July 31st 2020
January 1, 2019 – December 31, 2019$2.54July 31st 2020

IRS website link follows: https://www.irs.gov/affordable-care-act/patient-centered-outreach-research-institute-filing-due-dates-and-applicable-rates 

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