The Internal Revenue Service (IRS) has issued an updated version of IRS Form 720 and the instructions. Self-funded group health plan sponsors and health insurers must use this form to report and pay the fee required to fund the Patient-Centered Outcomes Research Institute (PCORI) under the Affordable Care Act (ACA).
The ACA established PCORI to collect and disseminate research on the clinical effectiveness of treatments in an effort to improve health care decisions. PCORI is funded through the payment of an annual fee equal to $1 (for the first plan year) and $2 (for subsequent years) multiplied by the average number of covered lives under the plan or policy. The fees are payable for plan or policy years ending on or after October 1, 2012, and continue for a total of seven years.
Form 720 and accompanying payment must be filed by July 31 for each year due.
As the federal health care reform effort gained steam, Ballard Spahr attorneys established the Health Care Reform Initiative to monitor and analyze legislative developments. With federal health care reform now a reality, our attorneys are assisting health care entities and employers in understanding the relevant changes and planning for the future. They also have launched the Health Care Reform Dashboard, an online resource center for news and analysis on developments under the Affordable Care Act.
If you have questions about the new reporting requirement, contact Edward I. Leeds at 215.864.8419 or leeds@ballardspahr.com, or Sharon M. Marshall at 215.864.8506 or marshalls@ballardspahr.com.