Each year, employers must wait for the IRS to update Form 720 to pay their Patient-Centered Outcomes Research Institute (PCORI) fees using the correct form. The IRS has released a revision to IRS Form 720, which is used to pay the PCORI fees due July 31, 2021.
The original PCORI fee requirement applied to plan years ending between 10/01/2012 through 09/30/2019, but was extended an additional ten years as part of the Further Consolidated Appropriations Act, 2020. This requirement now applies to plan years ending until 09/30/2029. As part of the Affordable Care Act (ACA), employer-sponsored health plan(s) are subject to PCORI fees. The fees are used to fund research on patient outcomes.
- Employers with health reimbursement arrangements (HRAs) that are integrated with major medical plans pay a PCORI fee on the HRA. Insurers pay a PCORI fee on the insured plan.
- Employers with self-funded health plans that are integrated with an HRA are required to pay a fee only on one plan.
- Non-excepted Health Care flexible spending accounts (FSA) are also subject to the fee. Employers are responsible for the payment.
The PCORI fees due July 31, 2021 include plan years ending in 2020. The table includes the applicable fee amount per covered life based on applicable plan year end date.
|Filing Due Date||Plan Years||Fee|
|July 31, 2021||Plan years ending on or after January 1, 2020 through September 30, 2020.||$2.54|
|July 31, 2021||Plan years ending on or after October 1, 2020 through December 31, 2020 (Includes calendar year plans).||$2.66|
PCORI fees for self-funded major medical plans, HRAs, and non-excepted Health Care FSAs are payable by the Employer using IRS Form 720 and are due by July 31.
For more information, refer to: PCORI’s Effect on HRAs and FSAs
Form 720 Instructions https://www.irs.gov/pub/irs-pdf/i720.pdf