IRS revises excise tax form for health reform law research fee payment
Reprints
Employers and insurers have a newly revised Internal Revenue Service tax form they must use to pay a fee mandated by the health care reform law that is due at the end of July.
The IRS has added two lines to Form 720 — now used to calculate and file federal excise taxes — that employers and insurers also will use for payment of the Patient-Centered Outcomes Research Fee.
With the first fee payment due July 31, “Employers have been very anxious to get this guidance,” said Rich Stover, a principal with Buck Consultants L.L.C. in Secaucus, N.J.
The fee will be $1 per plan participant for the first plan year ending after Sept, 30, 2012, and $2 per participant in succeeding years.
For plan years starting after Sept. 30, 2014, the fee will be indexed to reflect the percentage increase in national medical expenditures as published by the Department of Health and Human Services.
The fee applies to all health care plan participants, including those in retiree-only plans, even though such plans are largely exempt from the Patient Protection and Affordable Care Act.
In the case of self-funded plans, the fee is paid by employers, while insurers are liable for the fee in plans they insure.
Previous IRS guidance provides examples of methodologies that health plan sponsors can use to determine the number of participants to calculate the amount on the fee they owe.
The revised form and instructions are available here.
Read Next
-
Fewer employers plan to offer retiree prescription drug plans: Survey
The percentage of employers that plan to continue offering prescription drug plans to Medicare-eligible retirees has dropped dramatically in the past two years, according to a study released Wednesday by Buck Consultants L.L.C.
Related Stories
-
Fewer employers plan to offer retiree prescription drug plans: Survey
-
Insurers moving to write coverage in public health insurance exchanges
-
Limited plans may help employers avoid health care reform penalty
