IRS Updates PCORTF Fees, Payable in 2021

The Internal Revenue Service (IRS) announced that for plan years ending on or after October 1, 2020 and before October 1, 2021 Patient-Centered Outcomes Research Trust Fund (PCORTF) fees will be $2.66 multiplied by the average number of covered lives.

December 10, 2020

In IRS Notice 2020-84, the Internal Revenue Service (IRS) announced that for plan years ending on or after October 1, 2020 and before October 1, 2021 (i.e., the 2020 plan year for calendar year plans), Patient-Centered Outcomes Research Trust Fund (PCORTF) fees will be $2.66 multiplied by the average number of covered lives—an increase from the 2019 rate of $2.54.

Under the ACA, self-insured health plan sponsors and health insurers must pay PCORTF fees for plan or policy years ending on or after October 1, 2012 and before October 1, 2019 (2012 - 2018 for calendar year plans). Later legislation extended these fees through 2029. The fees, along with payments from the Medicare program, help fund the Patient-Centered Outcomes Research Institute (PCORI), which funds comparative clinical effectiveness research.

Effective Date

Employers must use IRS Form 720 to report and make payments for the 2020 plan year by July 31, 2021.

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