The Patient-Centered Outcomes Research Trust Fund fee is a fee imposed on insurance carriers of fully-insured group health plans and on plan sponsors of self-insured group health plans to fund the Patient-Centered Outcomes Research Institute (“PCORI”). The institute will assist, through research, patients, clinicians, purchasers and policy-makers, in making informed health decisions by advancing the quality and relevance of evidence-based medicine.

The PCORI fee applies to plan years beginning on or after October 1, 2012 and ending before October 1, 2019. For calendar year plan years, this means that the first PCORI fee applies to the plan year ending on December 31, 2012 and the last PCORI fee applies to the plan year ending on December 31, 2018.

The amount of the PCORI fee is equal to the average number of “covered lives” (covered lives includes employees, spouses, dependents and those receiving COBRA coverage) covered during the plan year multiplied by the applicable dollar amount for that plan year. For plan years beginning on or after October 1, 2012 and ending before October 1, 2013, the applicable dollar amount of the PCORI fee is $1. For plan years beginning on or after October 1, 2013 and ending before October 1, 2014, the applicable dollar amount is $2. For plan years beginning on or after October 1, 2014, and ending before October 1, 2019, the applicable dollar amount is adjusted for inflation, as determined by the Secretary of Health and Human Services.

For example, if you are an employer that sponsors a group health plan with a calendar year plan year, your PCORI fee will equal the “average number of lives” residing in the U.S. covered by the group health plan during the plan year multiplied by:

  • For the plan year ending on December 31, 2012 = $1 
  • For the plan year ending on December 31, 2013 = $2 
  • For the plan year ending on or after December 31, 2014 through Dec. 31, 2018 = An amount to be determined by the Secretary of Health and Human Services. 

The PCORI fee is due by July 31 for all plan years. The first fee (for the 2012 plan year) is due by July 31, 2013. The fee for the 2013 plan year will be due by July 31, 2014 and so forth. The PCORI fee can be reported and paid by completing Form 720 and filing the Form with the IRS.

Please note, if you are a plan sponsor of a self-insured group health plan, you must pay the PCORI fee by filing Form 720 with the IRS. Insurance carries for fully-insured group health plans will file Form 720 and pay the applicable PCORI fee.