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ObamaCare FAQ of the Month: What are PCORI Fees, and How Do We Pay Them?

June 2014

By: Peter E. Hansen, Esq.

The Patient-Centered Outcomes Research Institute ("PCORI") is a nonprofit organization established by the Affordable Care Act that conducts "comparative effectiveness research," meaning that it compares health care treatment methods in order to determine which method works best. The PCORI is expensive, or so it appears, so its funding relies in part on fees collected from health insurance issuers and group health plans - for now. The fees, which currently amount to $2.00 for each person covered under the plan during the plan year, will end after 2019.

As to how employers pay them, it depends on what type of health plan your company sponsors. Responsibility for reporting and paying the PCORI fees lies with the health insurance issuer for fully-insured plans, so employers who sponsor fully-insured plans have little to do other than verify that your plan sponsor is taking care of the fees. Conversely, employers who sponsor self-funded plans are responsible for both reporting and paying the PCORI fees by July 31, 2014, using IRS Form 720 for the 2013 plan year.

Questions? Suggestion for a future Obamacare FAQ of the Month? Please contact WS Attorney Peter E. Hansen at (262) 560-9696, or email pehansen@wesselssherman.com .