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Under the Affordable Care Act, some employers are set to face a July 31 deadline to pay a new fee. The fee, known as the PCORI (Patient-Centered Outcomes Research Institute) fee must be paid by employers who sponsor self-insured health plans, including health reimbursement arrangements and flexible spending arrangements.
Although the fee doesn’t amount to very much financially, it will add compliance and filing burdens, as well as the usual penalties for failure to file and failure to pay taxes to companies who may not be aware of the fee.
Below is a chart from the IRS summarizing which types of insurance coverage or arrangements are subject to the PCORI fee:
|
Type of insurance coverage or arrangement
|
Subject to PCORI fee?
|
Person responsible for paying and reporting the fee
|
| Accident and health coverage or major medical insurance coverage | Yes |
|
| Retiree-only health or major medical coverage | Yes |
|
| Health or major medical coverage under multiple policies or plans | Yes |
|
| COBRA coverage | Yes |
|
| Health Reimbursement Arrangement (HRA), including a premium-only HRA | Yes, unless the arrangement satisfies the requirements for being treated as an excepted benefit |
|
| Flexible Spending Arrangement (FSA) | Yes, unless arrangement satisfies requirements for being treated as excepted benefit |
|
| State & local government health or major medical plans for employees and/or retirees | Yes |
|
| Stand-alone dental or vision coverage | No | |
| Group insurance policy designed and issued specifically to cover primarily employees working and residing outside the U.S. | No | |
| Self-insured health plan designed specifically to cover primarily employees who are working/ residing outside the U.S. | No | |
| Medicare | No | |
| Medicaid | No | |
| Children’s Health Insurance Program (CHIP) | No | |
| Military health plans established by federal law to provide medical care (other than through insurance policies) to individuals (spouses or dependents) by reason of the individual being (or having been) a member of the Armed Forces of the U.S. | No | |
| Certain Indian tribal government health plans (programs established by federal law to provide medical care other than through insurance policies) | No (Note: The IRS stated on July 16 that some tribal health plans may be subject to PCORI fees) | |
| Health Savings Arrangements (HSAs) | No | |
| Archer Medical Savings Accounts (MSAs) | No | |
| Hospital indemnity or specified illness benefits | No | |
| Stop-loss or indemnity reinsurance | No | |
| Employee assistance programs, disease management programs, or wellness programs | No, if the program doesn’t provide significant benefits in the nature of medical care or treatment | |
| Accident-only coverage (including accidental death and dismemberment) | No | |
| Disability income coverage | No | |
| Automobile medical payment coverage | No | |
| Workers’ compensation or similar coverage | No | |
| On-site medical clinic | No |