Employers who have a Health Reimbursement Arrangement (HRA) or Medical Expense Reimbursement Plan (MERP), take note: the annual upcoming PCORI filing and fee payment is due August 2, 2021 for plans that end in 2020. Normally, the fee is due on July 31 of the following year, however, this year the due date has been extended to August 2 because July 31 falls on a Saturday.
What is PCORI?
PCORI, or the Patient Centered Outcomes Research Institute, was first introduced in the 2010 Affordable Care Act (ACA) to help fund research for different medical treatments. A portion of the institute’s funding come from these fees imposed on group health plans. PCORI fees apply to plans ending in years 2013 through 2029 (October 1, 2012 – September 30, 2029).
Understanding Your Responsibility
Participants enrolled in an HRA or MERP plan do not need to do anything; no action is required of participants.
Employers must file and pay the fee owed by the annual filing due date or risk an IRS penalty. All employers are required to pay the fee, including government entities and church organizations. Third Party Administrators (TPAs), like P&A, are not permitted to file on behalf of their clients. The fee and filing must be completed by the plan sponsor or employer.
For plan years ending in 2020, the fee per covered life is either $2.54 or $2.66, depending on your plan’s start and end date. Click here for the PCORI fee and payment schedule.
PCORI Filing: What Must be Completed
Employers must complete Form 720 and send the annual fee owed to the IRS. Instructions on how to complete the form and provide payment are included in Form 720.
Pro Tip: While Form 720 is labeled “Quarterly Federal Excise Tax Return Form,” the fee still occurs on an annual basis.
For questions about the PCORI filing and fee, please contact your P&A Group sales representative or submit a contact form.