ACA Fees: PCORI Fee Fully Insured

In the case of fully insured plans, the plan issuer or insurer (not the plan sponsor) is subject to the fee; however, we encourage employers to review this information and pay special attention to the:

“Plans Subject to the Fee” section to ensure they do not have to submit a fee for their HRA plans, FSA plans, or other self-insured coverage. The insurer is responsible for paying the PCORI fee for fully insured plans.

Plans Subject to the Fee

Fully insured and self-insured plans providing accident or health insurance for individuals living in the U.S., and plans established and maintained by an employer or employee organization to provide accident and health coverage are subject to the fee. This includes retiree-only plans, but does allow certain exemptions, such as excepted benefits.

• Health FSAs and HRAs are subject to the fee, unless they qualify as “excepted benefits.”

Entity Responsible for Fee Payment

In the case of fully insured plans, the plan issuer or insurer (not the plan sponsor) is subject to the fee.

Amount of Fee

The amount of the PCORI fee is equal to the average number of lives covered during the policy year or plan year multiplied by the applicable dollar amount for the year.

• Click here to view the fee amounts.
• Learn more about filing due dates and applicable rates here.

HRA and Health FSA Counting Rules

HRAs and Health FSAs that are not excepted benefits have special counting rules based on other plans provided (or not provided) by the employer.

Stand-Alone: If the HRA/Health FSA is not integrated with another self-funded plan, count one covered life for each employee with an HRA/Health FSA. Note that this differs from the counting method used for health plans, which must count each covered life (employees and dependents).

Integrated With Fully Insured Coverage: The employer must pay the PCORI fee for the self-insured HRA/Health FSA, calculated by counting one covered life for each employee with an HRA/Health FSA.

Integrated With Self-Insured Coverage: Count each individual covered by both plans only once. Add to this any individuals covered by only one plan using the counting method used for other individuals in that plan.

How and When Fees are Paid

The fees must be reported once a year on IRS Form 720 (Rev. April 2018) (Instructions). This form must be filed and fees paid on July 31 of the calendar year immediately following the last day of the plan year. The entity responsible for fee payment is subject to an excise tax ranging from 5% of the fee up to 25% of the fee, in addition to the fee itself.