Patient-Centered Outcomes Research Institute (PCORI) fees due July 31

PCORI fees help fund research that evaluates and compares health outcomes, clinical effectiveness, risks and benefits of medical treatments and services. The fee, effective 2012-2029, is treated like an excise tax by the IRS.

  • For plan and policy years that end on or after October 1, 2019, and before October 1, 2020, the PCORI fee is $2.54 per covered life.
  • For plan years that end on or after October 1, 2018, and before October 1, 2019, the PCORI fee is $2.45 per covered life.

PCORI fees were originally scheduled to be discontinued for plan years ending on or after October 1, 2019, but Congress passed an extension for an additional 10 years, through 2029. The final PCORI fees will be due by July 31, 2030, unless extended again.

2020 relief for counting covered lives

In Notice 2020-44, the IRS provides the following relief for calculating covered lives.

  • Issuers of applicable health insurance policies:
    • Consistent with prior years, may use one of four available counting methods:
      • Actual count method
      • Snapshot method
      • Member months method
      • State form method
    • “Use any reasonable method to calculate the average number of covered lives” as long as they use the same method for the entire year and across all policies for which they report a liability on Form 720 for that year.
  • Self-insured plan sponsors:
    • Consistent with prior years, may use one of three available counting methods:
      • Actual count method
      • Snapshot method
      • Form 5500 method
    • “Use any reasonable method to calculate the average number of covered lives” as long as they use the same method for the entire year.

Submitting the report to the IRS

  • Self-funded: Employers and plan sponsors are responsible for submitting IRS Form 720 and paying the PCORI fee by July 31. Instructions for completing the form are on the IRS website.
    • As a reminder the PCORI fee is assessed on all covered lives – including employees, retirees, spouses and dependents. 
    • The membership report from Employer eServices® may assist in the PCORI calculation.
  • All Savers: All Savers posts the employer group’s membership information to the employer website. The employer group is required to complete and file the IRS Form 720. For general questions please contact All Savers Broker Services at 1-866-405-7174.
  • Fully insured: UnitedHealthcare is responsible for filing Form 720 and paying the fee for fully insured coverage. We will submit the required payment by July 31. Our customers do not need to take any action. 

Important: fully insured customers with self-funded health reimbursement accounts (HRAs) and flexible spending accounts (FSAs) are required to pay the fee on each employee covered under the account.      

For more information, please contact your broker or UnitedHealthcare representative.