In Notice 2023-70, the Internal Revenue Service (IRS) has outlined the adjusted ACA Patient-Centered Outcomes Research Institute (PCORI) fees applicable to policy and plan years concluding on or after October 1, 2023, and before October 1, 2024.
PCORI Overview
For fully-insured plans, health insurance carriers directly cover the PCORI fee, relieving employers with solely fully-insured group health plans from any obligations. However, Employers overseeing self-funded medical plans or applicable Health Reimbursement Arrangements (HRAs) concluding in 2023 must use Form 720 to fulfill their reporting obligations and pay PCORI fees by July 31, 2024. The IRS provides a chart detailing the types of plans subject to the fee at IRS Chart.
Adjusted PCORI Fee
The payment amounts due in 2024 vary based on the employer’s plan year, specifically the plan year’s end date. The PCORI fee is increasing from $3.00 to $3.22 per covered life for plan years ending in October 2023 through December 2023 and January 2024 through September 2024.
| Plan Year End Date | Fee Per Covered Life | Filing Due Date |
|---|---|---|
Calculating the PCORI Fee
To calculate the PCORI fee, employers need to determine the average number of lives covered under a self-insured health plan using one of the IRS-approved methods for counting covered lives such as the actual count or snapshot method, and apply the relevant PCORI fee rate.
Guidance for Employers
Staying informed and taking the necessary actions will ensure compliance with IRS regulations and contribute to the ongoing support of valuable medical research. If you need assistance with reporting and paying PCORI fees by the deadline of July 31, 2024, contact your Pierce Group Benefits Account Executive or email partnership@piercegroupbenefits.com for further guidance.