PCORI fees are imposed by the IRS through the Affordable Care Act (ACA) and are used to fund the Patient-Centered Outcomes Research Trust Fund.

Patient-Centered Outcomes Research Trust Fund fees, or PCORI fees, are imposed by the Internal Revenue Service (IRS). The PCORI fee is assessed on issuers of certain health insurance policies and self-insured health plans. A portion of its funding contributes to the Patient Centered Outcomes Research Institute (PCORI), which advances clinical effectiveness research to help individuals make better healthcare decisions.

History of PCORI Fees

The PCORI fees went into effect in 2012 for certain policies and plans with policy years ending after September 30, 2012. Originally set to expire in 2019, it was renewed for 10 more years by the Further Consolidated Appropriations Act, 2020.

This was signed into law on December 20, 2019 and as a result, PCORI fees will continue to be enforced through 2029.

How much are PCORI Fees?

PCORI fees are calculated by multiplying the applicable dollar amount for the year by the average number of lives covered during the policy/plan year. The applicable dollar amount is adjusted annually to reflect inflation. Please see our graphic to the right to see the applicable dollar amounts.

There are four methods for issuers of specific health insurance policies to determine the average number of lives covered during the policy year. They are:

Actual Count method
Snapshot method
Member Months method
State Form method

There are three methods for plan sponsors of self-insured health plans to determine the average number of lives covered for a plan year. They are:

Actual Count method
Snapshot method
Form 5500 method

These methods are all explained in detail in the final regulations.

Other Resources

We have a plethora of resources to ensure that you’re up-to-date on the latest ACA news. Check out our Essential Guides to master all of your filing requirements or review our step-by-step guides for more information on preparing your filings.

BoomTax, The Boom Post, and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors prior to engaging in any transaction.