Alert: Are PCORI Fees Still Required For Self-Insured Health Plans?
Question: Our company has paid Patient-Centered Outcomes Research Institute (PCORI) fees for our self-insured health plan for several years. But I’ve heard that this requirement is expiring soon. When can we stop paying PCORI fees for our plan?
Answer: PCORI fees, which are used to fund research on patient-centered outcomes, are indeed paid by health insurers and self-insured health plan sponsors. They’re required for plan and policy years ending before October 1, 2019. For calendar-year plans and policies, the 2018 plan or policy year is the last year for which PCORI fees apply. However, if your plan isn’t on a calendar year, you may still owe PCORI fees for 2019.
A PCORI fee is considered an excise tax under the Internal Revenue Code and is reported on IRS Form 720. Although Form 720 is filed quarterly for other federal excise taxes, PCORI fee reporting and payment are only required annually — by July 31 of the year following the calendar year in which the applicable policy or plan year ended.
Thus, the Form 720 that reports liability for the PCORI fee imposed for a calendar-year plan year ending on December 31, 2018, should have been filed by July 31, 2019. The instructions to Form 720 advise taxpayers to keep their tax returns, records and supporting documentation for at least four years from the latest of the date the tax became due or the date the tax was paid. For further assistance, contact your tax advisor.