PCORI Fee Increased for Plan Years Ending After October 1, 2020
The IRS is raising the fee that insurers or self-insured health plan sponsors will pay in 2021 to fund the federal Patient-Centered Outcomes Research Institute (PCORI) trust fund. The fee will be $2.66 per plan enrollee, up from $2.54 for the 2020 plan year, according to Notice 2020-84, which the IRS issued on November 24, 2020. The annual fee must be paid to the IRS by July 31 for plan years ending between Oct. 1, 2020, and before Oct. 1, 2021, which includes calendar-year plans.
For fully insured employers, the fee is paid by the insurance provider, although the cost may be factored into premium increases. Self-insured employers pay the annual PCORI fee directly to the IRS.
Self-Funded plans (including employers with fully insured medical/Rx plans that include a self-funded HRA) must remit the PCORI fee to the IRS along with an IRS Form 720. (Note: The IRS has not yet updated Form 720 with the new, 2021 rate).
You may recall that PCORI was previously due to sunset in 2019, but was extended by Congress through 2029 (see prior guidance/updates here).
And, if you are looking for details on how to calculate PCORI, please read our prior guidance here or contact your Account Manager.
- IRS Notice 2020-84
- IRS Form 720 (basics) / PDF Form
- 12/30/2019 – End of Year Changes, PCORI Extension through 2029
- 05/17/2019 – PCORI Math – Counting Details
For more information, contact firstname.lastname@example.org. The information contained in this post, and any attachments, is not intended and should not be misconstrued as legal advice. You should contact your employment, benefits or ERISA attorney for legal direction.
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