PCORI Extended Under Spending Bill

In the Spending Bill signed on the eve of the New Year, many gifts were given to employer plan sponsors. However, there was also one less welcomed element of the legislation - an extension on the PCORI fee which was scheduled to expire in 2019 (for calendar year plans) and 2020 (for certain other plan years).

The Patient-Centered Outcomes Research Institute (PCORI) fee has been in effect since 2012, first payable in July, 2013. The fee applies to all health plans, and is paid by the carrier for fully insured medical plans, and the employer directly for self funded medical plans, and HRA plans. The fee will now apply for the next decade, expiring in 2030. This fee is currently $2.45, and will increase over the coming decade.

All employers with health plans beginning between February and October (i.e. plan years ending between January and September) were already required to pay $2.45 per covered member in July, 2020 (based on the headcounts from their 2018 plan years). Now, employers with plan years beginning between November and January (ie ending between October and December) will also need to pay this fee in July, 2020 (based on the headcounts from their 2018-2019 plan years). The amount due for the latter employer plan years will be determined.

For a list of the historical PCORI amounts, visit the IRS webpage.