If your organization offers a self-funded, level-funded, or Health Reimbursement Arrangement (HRA), there’s an annual IRS filing requirement that’s easy to overlook but important to complete on time—the Patient-Centered Outcomes Research Institute (PCORI) fee.
Although the fee itself is relatively small, missing the filing deadline can result in penalties and interest. Understanding who must pay, how the fee is calculated, and when it’s due can help your organization stay compliant.
🎥 Watch Our Video: PCORI Fee Explained
Understanding the PCORI fee doesn’t have to be complicated.
In this short video, Dawn Carlisle of JS Benefits Group explains what the PCORI fee is, who is responsible for paying it, how it’s calculated, and why the July 31 IRS filing deadline is so important for employers sponsoring self-funded, level-funded, or HRA health plans.
▶️ Watch the video here:
Prefer to read? Continue below for a complete breakdown of the PCORI fee, filing requirements, exemptions, and important compliance deadlines.
What Is the PCORI Fee?
The Patient-Centered Outcomes Research Institute (PCORI) fee was established under the Affordable Care Act (ACA) to help fund research comparing the effectiveness of medical treatments and healthcare services.
Each year, certain employers and health plan sponsors must report and pay the fee to the IRS using Form 720.
While the fee amount is relatively modest, filing is mandatory for applicable health plans.
Who Is Responsible for Paying the PCORI Fee?
Responsibility depends on how your health plan is funded.
Fully Insured Health Plans
If your health plan is fully insured, your insurance carrier is responsible for paying the PCORI fee. The fee is generally built into your insurance premium, so employers do not need to file separately.
Self-Funded Health Plans
Employers sponsoring self-funded health plans are responsible for calculating, reporting, and paying the PCORI fee directly to the IRS.
Level-Funded Health Plans
Although level-funded plans include stop-loss insurance, they are generally treated as self-funded for PCORI purposes. Employers sponsoring these plans are responsible for filing and paying the fee.
If you’re considering a level-funded strategy, learn more about our Level-Funded Health Plans:
https://jsbenefitsgroup.com/level-funded-health-plans/
Health Reimbursement Arrangements (HRAs)
Health Reimbursement Arrangements (HRAs) are also considered self-insured plans for PCORI purposes.
One important distinction is that employers generally calculate the fee using covered employees rather than covered employees and dependents, making the calculation simpler than many other self-funded arrangements.
How Much Is the PCORI Fee?
For plan years ending between October 1, 2025, and September 30, 2026, the applicable fee is:
$3.84 per covered life
The total amount due depends on your average number of covered lives during the plan year.
Although the amount is relatively small, employers should not overlook the filing requirement.
When Is the PCORI Fee Due?
The filing deadline is July 31 each year.
Employers report the fee using IRS Form 720.
Although Form 720 is normally used for quarterly excise taxes, the PCORI fee is reported only once annually.
There are no automatic filing extensions, making it important to prepare well before the deadline.
Plans That Are Generally Exempt
Not every employee benefit is subject to the PCORI fee.
Generally, the following are exempt:
- Stand-alone dental plans
- Stand-alone vision plans
- Health Savings Accounts (HSAs)
- Most Health Flexible Spending Accounts (FSAs)
The fee primarily applies to major medical coverage and Health Reimbursement Arrangements (HRAs).
Don’t Let a Small Fee Become a Bigger Compliance Problem
Because the PCORI fee is only filed once each year, it’s one of the easiest compliance deadlines to forget.
Unfortunately, missing the filing deadline can result in unnecessary penalties and interest.
At JS Benefits Group, we help employers stay ahead of compliance deadlines while developing employee benefits strategies that support both their workforce and their bottom line.
Whether you’re managing a self-funded health plan, evaluating an HRA, or exploring a level-funded solution, our team is here to help.
Learn more about our Employee Benefits Solutions:
https://jsbenefitsgroup.com/employee-benefits-solutions/
Need Help with PCORI Compliance?
Missing the PCORI filing deadline can lead to unnecessary penalties and administrative headaches—but it doesn’t have to.
At JS Benefits Group, we help employers navigate:
- PCORI Fee Filings
- ACA Compliance
- Employee Benefits Consulting
- Level-Funded Health Plans
- Health Reimbursement Arrangements (HRAs)
- Healthcare Cost Management
- Open Enrollment Strategy
Helpful Resources
Employee Benefits Benchmark Calculator
https://jsbenefitsgroup.com/employee-benefits-benchmark-calculator/
Level-Funded Health Plans
https://jsbenefitsgroup.com/level-funded-health-plans/
Employee Benefits Solutions
https://jsbenefitsgroup.com/employee-benefits-solutions/
Request a Complimentary Benefits Strategy Consultation
https://jsbenefitsgroup.com/request-consultation-form-group-health-benefits/
If you have questions about the PCORI fee or your overall employee benefits strategy, contact JS Benefits Group at 877-355-6070 or visit:
About the Author
Jennifer A. Schaefer, MBA, CLU, ChFC, RHU, REBC, SHRM-SCP is the Founder & CEO of JS Benefits Group, an employee benefits consulting firm helping employers reduce healthcare costs, simplify compliance, and build competitive employee benefits strategies. Jennifer is a Forbes Business Council Contributor and Co-Host of Executive Leaders Radio, where she shares insights on healthcare cost management, employee benefits, HR strategy, and the future of work.
