MORE PCORI FEE INFORMATION
More PCORI Fee Information
The Internal Revenue Service has published new questions and answers about the Patient-Centered Outcomes Research Institute (PCORI) Fee on its website. Clients and brokers may want to review the following information provided by the IRS:
Q: Does the PCORI fee apply to an applicable self-insured health plan that has a short plan year?
A: Yes. The PCORI fee applies to a short plan year of an applicable self-insured health plan. A short plan year is a plan year that spans fewer than 12 months and may occur for a number of reasons. For example, a newly established applicable self-insured health plan that operates using a calendar year has a short plan year as its first year if it was established and began operating beginning on a day other than Jan. 1. Similarly, a plan that operates with a fiscal plan year experiences a short plan year when its plan year is changed to a calendar year plan year.
Q: What is the PCORI fee for the short plan year?
A: The PCORI fee for the short plan year of an applicable self-insured health plan is equal to the average number of lives covered during that plan year multiplied by the applicable dollar amount for that plan year. Thus, for example, the PCORI fee for an applicable self-insured health plan that has a short plan year that starts on April 1, 2014, and ends on Dec. 31, 2014, is equal to the average number of lives covered for April through Dec. 31, 2014, multiplied by $2.08 (the applicable dollar amount for plan years ending on or after Oct. 1, 2014, but before Oct. 1, 2015).
Q: What is the PCORI fee due date for the short plan year?
A: The due date for the PCORI fee is July 31 of the year following the last day of the plan year (including a short plan year).
Q: Can a plan sponsor or policy issuer that overpaid the PCORI fee due July 31 reduce the PCORI fee due the following July 31 for the amount of the prior year’s overpayment?
A: No. Plan sponsors and policy issuers cannot reduce the PCORI fee due July 31 for any overpayment from a prior year. If a plan sponsor or policy issuer overpaid the PCORI fee reported on a previously filed Form 720, it should file Form 720X, Amended Quarterly Federal Excise Tax Return, for an overpayment of a previously filed PCORI liability. Form 720X is available on IRS.gov.
Q: How should corrections to a previously filed Form 720 be made, for example one that determined a fee using an incorrect applicable dollar amount?
A: A plan sponsor or policy issuer should make corrections to a previously filed Form 720 by filing a Form 720X, Amended Quarterly Federal Excise Tax Return, including adjustments that resulted in an overpayment. Form 720X may be filed anytime within the applicable limitation period. Form 720X is available on IRS.gov.
Follow this link for more information about the PCORI Fee.