The ACA imposes a fee on employers that offer certain types of self-insured health plans, which includes QSEHRA and ICHRA, to help fund the Patient-Centered Outcomes Research Institute (PCORI).
Note: The below is informational only. We are not licensed tax professionals (we’re the health people), and this information is not to be used as tax guidance. Please consult with your licensed tax professional on the usage of this information, calculation of fees, and completion of forms.
About the fee:
It is required to be reported only once a year in July.
It is reported on IRS Form 720.*
For plans that ended December 2023, the PCORI fee is $3.22 per employee, and it is due July 31, 2024. **
*Although Form 720 is a quarterly return, for PCORI, Form 720 is filed annually only, by July 31. If you have another reason to file Form 720 on a quarterly basis, you only need to report the PCORI fee on the second quarter form, due July 31st.
How do I calculate my PCORI fee?
The fee is per covered life, based on the average number of covered lives throughout the plan year. The IRS allows the plan sponsor to calculate average covered lives using a few different methods, and we provide information for you to use the Snapshot Method (counting covered lives around the same date once a quarter).
For an HRA, covered lives include employees (not spouses or dependents) who have not waived coverage. You can look at your Take Command Health monthly invoice to check how many covered lives you had during any month.
Also, note that If the PCORI fee owed is $0 (due to 0 covered lives), IRS Form 720 does not need to be filed.
Does Take Command Health help me report and pay the PCORI fee?
Yes! We are here to help. To assist you in complying with this requirement, we will provide to you in June each year: 1) an estimate of your average number of lives covered by your HRA during your plan year based on the information in our system, and 2) some information about filing IRS Form 720 and paying the fee.
How do I file my Form 720 & pay my PCORI fee?
To file your Form 720, mail the completed Form 720, along with Form 720-V (Payment Voucher), and a check or money order for the total owed to the IRS:
Department of the Treasury
Internal Revenue Service
Ogden, UT 84201-0009
If you prefer, you can pay electronically through EFTPS. Electronic payments must be initiated before July 29th 8:00pm EST. Note that you'll still need to mail in your Form 720 even if you pay electronically.
For more detailed information, see the IRS Instructions for Form 720.