Can I file PCORI fee for my employees

Article Summary

1. Whether you file the PCORI fee comes down to plan funding: fully insured plans leave the fee to the carrier, but self-funded, level-funded, and HRA-based plans put the filing duty on the employer.

2. Level-funded plans still count as self-funded for PCORI purposes, even though they include stop-loss coverage.

3. HRAs owe a separate fee when paired with a fully insured plan, but fold into one combined fee when paired with a self-funded plan. ICHRAs and QSEHRAs also require filing.

4. HSAs themselves are exempt, but an HDHP paired with an HSA is subject to the fee, with responsibility depending on how the HDHP is funded.

5. Most FSAs and standalone dental or vision plans are excepted benefits and don't trigger the fee at all.

6. Before filing, employers need their EIN, plan year-end date, plan type, chosen method for counting covered lives, and the applicable rate: $3.47 per covered life for plan years ending January–September 2025, rising to $3.84 for October 2025–September 2026.

7. Filing happens on Form 720 under IRS No. 133, and only the second-quarter return needs to be filed if PCORI is the sole reason for filing.

8. Missing the July 31 deadline can result in a penalty of 5% of the unpaid fee per month, up to 25%, plus interest until the balance is paid.

Employers sponsoring a health plan for their teams often assume the IRS treats all coverage the same way when it comes to PCORI fee filing. It doesn't. Depending on how your plan is funded, the responsibility to calculate, report, and pay the PCORI fee for employees can land squarely on your desk, or it might never reach you at all. Here's how to tell which situation applies to you.

Yes. If you sponsor a self-funded plan, a level-funded plan, or offer an HRA for your employees, you are the one responsible for calculating, reporting, and paying the PCORI fee, not your insurance carrier.

That responsibility exists because the IRS places the filing duty on the plan sponsor whenever a plan isn't fully insured. Once your organization is funding the coverage rather than an insurer, the fee becomes your obligation to file on Form 720. The details of exactly which arrangements count and how the fee applies to each are covered next.

The trigger isn't the size of your workforce or the type of business you run. It's the funding structure behind the plan itself.

Self-Funded and Level-Funded Plans

Once you fund your own health coverage, you're directly responsible for calculating, reporting, and paying the fee. Level-funded plans include stop-loss insurance, but for PCORI purposes they're still treated as self-funded, so the filing duty stays with you.

Health Reimbursement Arrangements (HRAs)

HRAs are treated as self-insured coverage. If your HRA is paired with a fully insured medical plan, the carrier pays the fee on the insured plan, but you're still responsible for the HRA portion, counted by covered employees rather than employees and dependents. If the HRA is paired with a self-funded plan, there's no separate HRA fee since the self-funded plan already covers it. ICHRAs and QSEHRAs also require filing.

HSAs and HDHPs

HSAs themselves aren't subject to the fee since they're individual savings accounts, not group plans. But a High Deductible Health Plan paired with an HSA is subject to it like any other medical plan, with responsibility falling on whoever insures or funds that HDHP.

Plans That Are Generally Exempt

Most FSAs, along with standalone dental and vision plans, are excepted benefits and fall outside PCORI fee requirements. If this is the only coverage you offer, filing likely doesn't apply to you.

Before sitting down with Form 720, it helps to pull everything together first so you aren't hunting for details halfway through. Here's what you'll need on hand:

• Business name, address, and your Employer Identification Number (EIN)

• The plan year-end date matters a lot here, since it determines which rate applies to you

• Plan type being reported, whether that's self-funded, level-funded, an HRA, ICHRA, or QSEHRA

• A method for calculating average covered lives. Most employers pick actual count, snapshot, or the Form 5500 method if the plan is self-insured

• The average number of covered lives for that plan year

• Which rate applies. For plan years ending January through September 2025, it's $3.47 per covered life, and that climbs to $3.84 for plan years ending between October 2025 and September 2026

Once the numbers are gathered, filing itself isn't too complicated. It comes down to a few steps done in order.

• Report the fee under IRS No. 133, found in Part II of Form 720

• Enter the average covered lives figure, multiply by the applicable rate, and that gives you the total owed.

• If PCORI is the only reason you're filing Form 720 at all, you only need to submit the second-quarter return, not all four

• Payment can go through several accepted channels: IRS Direct Pay, debit or credit card, Electronic Funds Withdrawal, EFTPS, same-day wire, or even cash at participating retailers

• The whole thing is due by July 31 each year, and it covers plan years that wrapped up during the prior calendar year. There's no automatic extension, so this date tends to sneak up on people who assume otherwise.

Visit our PCORI Online Filing page and get your PCORI Fee reported within minutes by following the simple steps.

Missing the July 31 deadline doesn't just mean a late form sitting in a drawer somewhere. It carries a real cost.

The IRS applies a late filing penalty of 5% of the unpaid fee for each month it goes unpaid, capped at 25% of the total amount due. On top of that, interest accrues on the unpaid balance until it's paid in full. Since there's no automatic extension for this filing, an employer who assumes there's room to push the date risks paying more than the fee itself would have cost.

Visit our page which details the Bulk PCORI Fee filings for HRs.

Conclusion

Filing the PCORI fee comes down to one question: does your organization fund its own health coverage, in whole or in part? If so, the responsibility is yours, and understanding your plan structure now avoids costly surprises later.

If you're still working out whether your plan owes the fee this year, Simple720 can help you calculate and file it correctly before the deadline.

File your Online PCORI Fee with Simple720 Now!