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.
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PCORI PAYMENT SCHEDULE
| PLAN YEAR | PAYMENT AMOUNT | DUE DATE |
| February 1, 2018 – January 31, 2019 | $2.45 | July 31st 2020 |
| March 1, 2018 – February 28, 2019 | $2.45 | July 31st 2020 |
| April 1, 2018 – March 31, 2019 | $2.45 | July 31st 2020 |
| May 1, 2018 – April 30, 2019 | $2.45 | July 31st 2020 |
| June 1, 2018 – May 31, 2019 | $2.45 | July 31st 2020 |
| July 1, 2018 – June 30, 2019 | $2.45 | July 31st 2020 |
| August 1, 2018 – July 31, 2019 | $2.45 | July 31st 2020 |
| September 1, 2018 – August 31, 2019 | $2.45 | July 31st 2020 |
| October 1, 2018 – September 30, 2019 | $2.45 | July 31st 2020 |
| November 1, 2018 – October 31, 2019 | $2.54 | July 31st 2020 |
| December 1, 2018 – November 30, 2019 | $2.54 | July 31st 2020 |
| January 1, 2019 – December 31, 2019 | $2.54 | July 31st 2020 |
IRS website link follows: https://www.irs.gov/affordable-care-act/patient-centered-outreach-research-institute-filing-due-dates-and-applicable-rates
