PCOR Fee Indexed for 2021
The Patient Centered Outcomes Research (PCOR) Fee was created by the Affordable Care Act (ACA) as a temporary 7-year clinical effectiveness research fund (some insurers call it CERF). The fee was extended another 10 years by a law that permanently repealed three other significantly more expensive ACA taxes (including the §4980I “Cadillac” Tax).
The PCOR Fee is payable by insurers for insured plans, but employers with a health reimbursement arrangement (HRA) coupled with an insured plan must separately file and pay the PCOR fee, too. Employers with self-funded health plans must file and pay the PCOR Fee on their own. There are special rules on how to count your average enrolled members, and short plan years do not get to pro-rate their average down.
The fee is due July 31 of the calendar year after the plan year ends. IRS Notice 2020-84 provides the new indexed amount of the fee as $2.66 for plan years ending between October 1, 2020, and September 30, 2021. This is indexed up from the prior fee of $2.54.
Below is a table of a typical 12-month plan year and its corresponding fee and due date for illustrative purposes. Let your IMA Benefits team know if you need more assistance identifying your fee and due date.
|Self-Funded Plan Year Ends||For a typical 12-month plan, Self-Funded Plan Year Began||PCOR Fee||Due to IRS on Form 720 by|
|1/1/19 – 9/30/19||Non-CY Feb through Oct 2018||$2.45||Fri 7/31/20|
|10/1/19 – 12/31/19||Nov ‘18, Dec ‘18, or Jan ‘19||$2.54||Fri 7/31/20|
|1/1/20 – 9/30/20||Non-CY Feb through Oct 2019||$2.54||Mon 8/2/21|
|10/1/20 – 12/31/20||Nov ’19, Dec ’19, or Jan ‘20||$2.66||Mon 8/2/21|
|1/1/21 – 9/30/21||Non-CY Feb through Oct 2020||$2.66||Mon 8/1/22|
IMA will continue to monitor regulator guidance and offer meaningful, practical, timely information.
This material should not be considered as a substitute for legal, tax and/or actuarial advice. Contact the appropriate professional counsel for such matters. These materials are not exhaustive and are subject to possible changes in applicable laws, rules, and regulations and their interpretations.