PCORI Filings and Fees (2023 Edition)
As we explained in 2020, funding for the Patient-Centered Outcomes Research Institute (PCORI) was supposed to end with filings and fees for plan years that began before October 1, 2019. In the words of the great philosopher Emily Litella, “Never mind.”
As part of the Bipartisan Budget Act of 2019, the PCORI annual filing and fees were reinstated for an additional 10 years, through 2029. That means that all employers (or their insurers in fully insured group health plans) must file the annual IRS Form 720 (instructions here) by July 31st of each year, regardless of their plan year.
Further, with the filing of the Form 720, fees must also be paid for all participants. To complete the form for self-funded group health plans, that means counting “belly buttons,” including all employees and covered dependents and others. Generally, health care Flexible Spending Accounts (FSAs) are not required to file a Form 720 unless the employer (and not just the employee) makes contributions to it that exceed the lesser of $500 annually or a dollar-for-dollar match of the employee’s contribution. In that event, those FSAs must also be included in filing the Form 720. For Health Reimbursement Arrangements (HRA), you must first look at the integrated group health plan. If that plan is fully insured, then the employer must file the 720 for the HRA and pay the $3.00 fee for plan years that end on or after October 1, 2022 through September 30, 2023 (for plan years that ended on or after October 1, 2021 through September 30, 2022, the fee is $2.79). In that case, the fee is paid per employee, not per “belly button.” If however, the underlying group health plan is self-funded then no separate 720 need be filed for the integrated HRA but rather one filing and fee for the self-funded group health plan is due, based on “belly buttons,” not just employees.