The Internal Revenue Service (IRS) increased the patient-centered outcomes research institute (PCORI) fee for the health plan or policy years ending on or after October 1, 2019, but before October 1, 2020 from $2.45 to $2.54 times the average number of covered lives under the plan or policy.  

This temporary Affordable Care Act fee applied to insured and self-insured group health plans for each plan or policy year ending after Sept. 30, 2012, and before Oct. 1, 2019. It was extended through September 30, 2029 as a result of the Further Consolidated Appropriations Act of 2020.

Plan sponsors of applicable self-insured health plans for plan years ending on or after October 1, 2019, and before October 1, 2020, may not have anticipated the need to identify the number of covered lives for this period. Plan sponsors may continue to use one of the following three methods specified in the regulations to calculate the average number of covered lives for purposes of the fee imposed, the actual count method, the snapshot method, and the Form 5500 method.

Please remember that health plans with calendar year plan or policy years ending on or after October 1, 2019 and before January 1, 2020 will use the new $2.54 rate when calculating the PCORI fee due this July on Form 720.

For a copy of Notice 2020-44, please click on the link below:

https://benefitslink.com/src/irs/n-20-44.pdf

 

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