Who Pays the PCORI Fee?
Who pays the PCORI fee depends on one thing: whether the coverage is provided through an insurance policy. If it is, the issuer (the insurance company) pays. If it isn't, the plan sponsor pays, and that is usually the employer. The IRS is direct about it: issuers of specified health insurance policies and plan sponsors of applicable self-insured health plans are responsible for reporting and paying the fee.
A plan counts as self-insured if any portion of the coverage is provided other than through an insurance policy. That small phrase is why a company can have insurance and still owe this fee.
Who pays, by type of coverage
This table follows the IRS chart of common coverage types.
| Coverage | Subject to the fee? | Who pays and reports |
|---|---|---|
| Major medical or accident and health | Yes | Issuer if insured; plan sponsor if self-insured |
| Retiree-only health coverage | Yes | Issuer if insured; plan sponsor if self-insured |
| COBRA coverage | Yes | Issuer if insured; plan sponsor if self-insured |
| State and local government employee or retiree plans | Yes | Issuer if insured; plan sponsor if self-insured |
| Coverage under multiple policies or plans | Yes | Each issuer or plan sponsor |
| HRA, including a premium-only HRA | Yes, unless an excepted benefit | Plan sponsor |
| FSA | Yes, unless an excepted benefit | Plan sponsor |
| Stand-alone dental or vision | No | No one |
| Stop-loss or indemnity reinsurance | No | No one |
| HSAs and Archer MSAs | No | No one |
| Medicare, Medicaid, CHIP, and military health plans | No | No one |
The IRS adds a clear example of the mixed case. If an HRA can pay deductibles and copays under an insurance policy, the HRA and the policy carry separate fees. The insurer pays on the policy and the employer pays on the HRA. If the HRA instead sits alongside the employer's own self-insured plan, with the same sponsor and plan year, only the self-insured plan carries a fee. Our HRA and FSA guide covers the counting that follows from this. Level-funded arrangements raise similar questions, as explained in PCORI for level-funded plans.
Who is the plan sponsor?
Usually it's obvious, but not always. The regulation defines it by how the plan was set up:
| Plan established or maintained by | Plan sponsor |
|---|---|
| A single employer | The employer |
| An employee organization | The employee organization |
| A multiemployer plan | The joint board of trustees |
| A multiple employer welfare arrangement | The committee |
| A rural electric cooperative or rural cooperative association | The cooperative or association |
| A voluntary employees' beneficiary association (not merely a funding vehicle) | The trustee |
Plans shared by related employers
When a plan doesn't fit any of those, such as one set up by several companies in a group, the plan document can identify or designate the sponsor. A designation must be in writing, and that person must consent in writing, no later than the date the return for that plan year is due. After that date it can't be changed for that plan year. The person designated must be one of those establishing or maintaining the plan.
Without any designation, each employer is a plan sponsor for its own employees, and each must file a separate Form 720. The regulation's example is a holding company with three subsidiaries sharing a plan. With no sponsor named, all three file. If the plan document designates one subsidiary and it consents in time, that one files for all covered lives. This can spare a group a number of separate returns, so check your plan document well before the deadline.
What can a TPA take responsibility for?
A third-party administrator (TPA) runs claims or paperwork for a self-insured plan. The IRS sources don't mention TPAs at all when they say who owes the fee. They name issuers and plan sponsors. A TPA isn't on the regulation's list of plan sponsors, and only someone establishing or maintaining the plan can be designated as sponsor. So here is the fair reading of what's divided up:
| A TPA can help with | What stays with the plan sponsor |
|---|---|
| Producing enrollment counts for you | Liability for the fee |
| Preparing the return, as a paid preparer who signs and enters a PTIN if paid and not your employee | Having a person authorized by the entity sign Form 720 |
| Acting as your third party designee, if you check "Yes" and name them, to discuss the return with the IRS | Making sure the return is filed and the fee is paid on time |
For more on arrangements with outside firms, see whether a TPA can file the PCORI fee. A sponsor also has a separate question about which funds can pay the fee, covered in paying the fee from plan assets.
If it turns out you're the one who pays
- Confirm the filer's EIN. The return goes under the plan sponsor's EIN and name.
- Work out the amount. Average covered lives times the rate for your plan year end. The PCORI fee calculator does this. Self-insured plans report on lines 133(c) and 133(d) of the June 2026 form.
- File the second-quarter Form 720 and pay by the due date, which is July 31 of the year after the plan year ended, or the next business day if that falls on a weekend or legal holiday.
Employers can file the PCORI fee online through EasyFile720, an IRS-authorized e-file provider, with no credit card to start and $39.95 due when you file. TPAs, benefits consultants, and other preparers can file for several client businesses under one account, with each return filed under that client's business. See PCORI filing for firms if that is you. You can also start from the main PCORI fee page.
FAQ
Our contract says the TPA handles PCORI. Are we covered?▼
The contract can have the TPA do the work, but the IRS rules name the plan sponsor as liable. Ask for a copy of the filed return and the IRS acknowledgment so you can see it was done.
Do we pay the fee on stop-loss coverage too?▼
No. Stop-loss and indemnity reinsurance are not subject to the fee, but the self-insured plan they sit behind is. The sponsor pays on the plan, and no fee applies to the stop-loss policy.
Who pays for a retiree-only plan?▼
The same rule applies. The issuer pays if the retiree coverage is insured, and the plan sponsor pays if it is self-insured.
Who pays if one employer leaves a plan shared with other employers mid-year?▼
The IRS sources we reviewed do not address that situation. Look at who is identified as sponsor in the plan document, and get tax advice on the specifics.
File your PCORI fee online
Create a free account with no credit card and build your return. You pay $39.95 only when you file. EasyFile720 is an IRS-authorized e-file provider, and you get an acknowledgment when the IRS accepts your return.
Sources: IRS chart of coverage types; IRS PCORI Questions and Answers; 26 CFR 46.4375-1; 26 CFR 46.4376-1; 26 CFR 46.4377-1; Instructions for Form 720 (Rev. June 2026). General information, not tax advice. Confirm how the rules apply to you with a qualified advisor or the IRS.
