The PCOR fee funds research by a nonprofit institute into the effectiveness, efficiency, and quality of health care. Hopefully, the results of this research will lead to lower costs in delivering health care and lower premiums for health coverage.
The issuer of an insured group major medical plan pays the fee for each covered life (employee and family members). The employer-plan sponsor of a self-insured major medical plan pays the fee.
For plan years that ended between January 1, 2014 and September 30, 2014, the PCOR fee is $2 per covered life. For plan years that ended between October 1, 2014 and December 31, 2014, the PCOR fee is $2.08 per covered life – thus a calendar year plan pays a PCOR fee of $2.08 per covered life by July 31, 2015.
Through regulatory guidance, the PCOR fee applies to the employer’s health reimbursement arrangement (HRA) unless that HRA only reimburses dental or vision expenses. The PCOR fee also applies to a non-excepted health FSA. Further, when the employer pays the PCOR fee for an affected HRA or non-excepted health FSA, the fee only applies to the number of covered employees, not family members.
Please contact Gunn-Mowery‘s Employee Benefits Specialists with any questions about the PCOR fee and filing your Form 720.