The Patient Protection and Affordable Care Act (“ACA” or health care reform) added sections 4375, 4376 and 4377 of the Code which impose the Patient-Centered Outcomes research (“PCOR”) fee ($1 per covered life for the first year and $2 or more per covered life in later years) on employer-provided health plans. For calendar year plans ending December 31, 2012, the PCOR fee is due by July 31, 2013. Note: The delay in the effective date of the employer-shared responsibility penalty did not delay the due date for the PCOR fee.

Form 720

Employers that sponsor self-insured health plans should file Form 720 to report and pay the PCOR fee on an annual basis. To report and remit the fee, complete Part II, Line IRS No. 133 of the Form 720 and use the payment voucher (Form 720-V). Electronic filing of the form is permitted, but not mandatory. Click here to access Form 720. To access form instructions, click here. PCOR FAQs issued by the IRS are available here.

Payment Date

Form 720 must be filed on an annual basis in the second quarter of each year. Payment of the fee is due by July 31 of the year following the last day of the plan year. For calendar year plans that ended between October 2 and December 31, 2012, the fee is due July 31, 2013. Other fiscal year plans may also have to pay the fee depending on the last day of the plan year. For those plans ending after 2012, the fee will not be due until July 31, 2014.

Fee Calculation

As noted above, the PCOR fee amount is based on covered lives (which generally is not the number of participants) and increases over time. See our earlier update (here) for information on how the fee is charged. For more in-depth information on the calculation methods for average number of lives, click here.


Please contact any of the attorneys in the Dorsey & Whitney Benefits and Compensation department if you have questions.