PCORI Fee Filing FAQs

The Patient-Centered Outcomes Research Institute (PCORI) Fee is a federal charge on specific health insurance plans and self-insured health programs. This fee finances medical research comparing the effectiveness of various healthcare treatments and services.

The PCORI Fee was set up as part of the Affordable Care Act (ACA) back in 2010. So, it first applied to plan and policy years ending after September 30, 2012.

Absolutely, the PCORI Fee is still going strong. Even though it was meant to wrap up at one point, Congress kept it rolling through plan and policy years ending before October 1, 2029. Plans need to file and pay the fee yearly, no exceptions.

It's short for the Patient-Centered Outcomes Research Institute. This is an independent, nonprofit group that funds research aimed at helping patients and healthcare providers make smart healthcare choices.

A common misconception is that PCORI is a government office. It is not. PCORI is an independent nonprofit organization established by Congress and funded in part through the PCORI Fee.

It depends on the kind of coverage. Health insurance companies foot the bill for fully insured plans, while employers or plan sponsors cover self-insured health plans. Some HRAs might need separate PCORI Fee reporting too.

As for exemptions, the PCORI Fee doesn't apply to certain governmental programs like Medicare, Medicaid, CHIP, and some military and veteran health care programs. Plans offering just standalone dental or vision coverage or most FSAs, HSAs, and MSAs aren't included either. That goes for accident-only coverage, disability income coverage, workers' comp, and specific Employee Assistance Programs or wellness programs that don't offer substantial medical care.

As for exemptions, the PCORI Fee doesn't apply to certain governmental programs like Medicare, Medicaid, CHIP, and some military and veteran health care programs. Plans offering just standalone dental or vision coverage or most FSAs, HSAs, and MSAs aren't included either. That goes for accident-only coverage, disability income coverage, workers' comp, and specific Employee Assistance Programs or wellness programs that don't offer substantial medical care.

It was set up to support studies assessing medical treatments and strategies. This aims to boost healthcare results and give patients and caregivers more useful info.

The PCORI Fee is reported and paid using Form 720, the Quarterly Federal Excise Tax Return. Even though Form 720 is typically used quarterly, you only report the PCORI Fee once a year on the second-quarter form.

For reporting the PCORI Fee, there are two main options.

Most people find that electronic filing is quicker and easier too.

The fee is due annually by July 31 of the calendar year immediately following the last day of the plan or policy year. For example:

  • Plan year ending December 31, 2025 → Due July 31, 2026
  • Plan year ending June 30, 2025 → Due July 31, 2026

Most people find that electronic filing is quicker and easier too.

If July 31 lands on a weekend or federal holiday, the IRS pushes the deadline to the following business day. So, you don't need to rush; just finish by the first working day afterwards.

For filings due in 2026:

  • $3.47 per covered life for plan or policy years ending on or after October 1, 2024 and before October 1, 2025
  • $3.84 per covered life for plan or policy years ending on or after October 1, 2025 and before October 1, 2026

Yes. If your plan year ended December 31, 2025 and you had 500 covered lives:

500 * $3.84 = $1,920

Your total PCORI Fee would be $1,920.

The IRS approves three ways to figure out the average number of people covered under a self-insured health plan.

  • Actual Count Method - You count how many folks are covered every day of the plan year and then divide that by the number of days in the year.
  • Snapshot Method - With this one, you pick certain days in each quarter to count your covered members and then find the average.
  • Form 5500 Method - If eligible, you can simply use the numbers from your Form 5500.

These methods are primarily used when manually calculating the PCORI Fee for self-insured health plans.

The IRS releases these figures yearly for the plan or policy year ending month. Check their PCORI Fee Due Dates and Applicable Rates page for the info.

As per the current Form 720 instructions, paper Form 720 returns should be mailed to: Department of the Treasury, Internal Revenue Service, Ogden, UT 84201-0009

Always use the latest Form 720 instructions before mailing your return because IRS mailing addresses can change.

The easiest way to file a PCORI fee return is electronically through an IRS-approved portal. This cuts down on paperwork, helps you avoid calculation mistakes, and lets you file from anywhere. So it's pretty handy.

Online filing offers several advantages:

  • Faster submission process
  • Reduced manual errors
  • Secure electronic records
  • Convenient payment options
  • Quick confirmation after IRS acceptance

No special software needed for the PCORI fee. You can file using IRS-approved online portals in your web browser without any downloads or installs.

Look for a provider that offers:

  • IRS-authorized e-filing
  • Secure data protection
  • Simple user experience
  • Transparent pricing
  • Reliable customer support

Simple720 is designed specifically to simplify Form 720 and PCORI Fee filing.

Simple720 supports a wide range of users, including:

The process is simple:

  • Create or log into your account.
  • Enter your plan information and covered lives.
  • Review the calculated fee, pay online, and submit electronically.

Yes, Simple720 does it automatically. It figures out the PCORI Fee using the average number of covered lives and the relevant IRS rate for the chosen plan year. So it's pretty convenient for users.

Typically, you should have:

  • Employer Identification Number (EIN)
  • Business information
  • Plan or policy year end date
  • Average covered lives
  • Payment information

Having these details ready makes filing faster.

Yes, there are PCORI penalties for not filing the PCORI Fee. If you don't submit Form 720 or are late with payment by July 31, you'll face IRS penalties and interest. So, make sure to report accurately and pay on time to avoid trouble.

The simplest way is to:

  • Determine whether your plan is subject to the fee
  • File Form 720 on time
  • Submit payment by the due date

Choosing an online method will help you from penalties.

In many cases, yes. Usually, these plans are seen as self-insured for PCORI Fee purposes. This makes the employer or plan sponsor responsible for both reporting and payment. To know for sure, check the plan documents for the exact filing duties.

Yeah, fully insured health plans do pay the PCORI Fee. The insurer handles that though, not the employer. So the company that provides the insurance takes care of reporting and paying it.

Yeah, self-insured health plans have to pay the PCORI Fee. The plan sponsor calculates it, reports it, and pays it using Form 720. So it's their responsibility.

Yes, HRAs usually are subject to the PCORI Fee, unless they qualify as an excepted benefit. Plan sponsors have to report and pay this fee. So, it's important to check the exceptions too.

The IRS advises keeping supporting documents for as long as needed for tax stuff, including your filings, life calculations, and payments. So make sure to hang onto them until they're not needed anymore.

Sure, a CPA or TPA can totally file the PCORI Fee for their client. They use platforms like Simple720, which is approved by the IRS, to handle these tasks for clients.

Simple720's IRS-approved online filing is a breeze. They do your PCORI Fee calculation automatically, no downloads needed. Navigating is easy, payments are secure, and you get a speedy IRS confirmation. Plus, their bulk filing option makes work simpler for CPAs, TPAs, HR, and employers dealing with lots of filings.