By July 31, employers that sponsor self-funded medical plans must report and pay their PCORI fee. By July 31, employers that sponsor calendar-year employee benefit plans that are subject to ERISA must file a Form 5500 (unless an exception applies) or request an extension by filing a Form 5558.

PCORI Fee

The fee is used to fund the Patient-Centered Outcomes Research Institute (PCORI). The PCORI is an independent, nonprofit research organization, and is the leading funder of patient-centered comparative clinical effectiveness research in the United States. Originally, the fee was to last only 6 years, with calendar-year plans making their final payment in 2019. However, in a spending bill passed by Congress in late 2019, the PCORI fee was extended to 2029.

The amount of the PCORI fee for the relevant plan year is equal to the average number of covered lives during that plan year, multiplied by a specific dollar amount that is indexed.

• What is the relevant plan year? The plan year that ended during 2022.
• How do employers determine the average number of covered lives? Traditionally, employers have been allowed to use the actual count method, the snapshot method, or the Form 5500 method. For the PCORI fee due on July 31, 2023, employers may use any of those methods, or they may use any other reasonable method to determine the average number of covered lives.
• What is the specific dollar amount? For calendar-year plans, the specific dollar amount is $3.00. For fiscal-year plans whose plan year ended on or between January 1, 2022 and September 30, 2022, the specific dollar amount is $2.79. For fiscal-year plans whose plan year ended on or between October 1, 2022 and December 31, 2022, the specific dollar amount is $3.00.

Employers must report and pay the PCORI fee by filing Form 720 and remitting payment on or before July 31, 2023. Please let us know if you need assistance in calculating your PCORI fee or completing your Form 720.

Form 5500

The Form 5500 filing deadline for calendar-year ERISA plans is July 31, 2023. Instructions for completing and filing the Form 5500 are located on the Department of Labor website here. Employers may extend the filing deadline to October 15 if they file a Form 5558 extension by July 31.

Some plans are exempt from the Form 5500 obligation. For example, certain "Top Hat" plans are exempt. Similarly, certain employee welfare benefit plans with fewer than 100 participants are exempt. To take advantage of either of these exemptions, the plan must meet a number of requirements.