As an employer of a self-insured health plan, you and commercial group health insurance providers are required to pay an annual fee to fund the Patient-Centered Outcomes Research Institute (PCORI). For 2017, the fee will rise by an additional nine cents per plan enrollee. IRS Notice 2016-64 states that the PCORI fee for plan years ending on or after October 1, 2016 and before October 1, 2017, including calendar year plans, is $2.26 per person covered under the applicable health plan. The PCORI fee was $2.17 last year. This fee originated from the Affordable Care Act (ACA) to pay for research on the clinic effectiveness of medical procedures. The fee is assessed each plan year, which started in 2012 and is slated to end in 2019. The amount of the fee is adjusted each year for inflation.
To pay the fees, a self-insured employer/plan sponsor must submit the fee and appropriate paperwork to the IRS – third party reporting or payment is not allowed for self-funded plans. Please note that while the PCORI fee should not be included in the cost of your plan when you are computing your plan’s cost for COBRA premium, you are entitled to treat it as a tax-deductible business expense as an employer with a self-funded plan. Read here for more information on PCORI fees.