PCORI Fees due by July 31
With summer in full swing, July 31 will be here before you know it. On or before that date, some employers will need to file an Internal Revenue Service (IRS) Form 720 and submit the applicable payment for their Patient Centered Outcomes Research Institute (PCORI) fees. Employers with self-funded health plans and those with health savings accounts (HRAs) are generally responsible for filing and paying the fee. Employers with fully-insured health plans are generally not responsible for the filing or paying unless they also sponsor an HRA.
Remember, the cutoff for figuring the amount you may owe is based on the month and year in which your plan ends, not when it begins. For example, a plan or policy that renewed on Jan. 1, 2019 technically ended on Dec. 31, 2018 and would owe $2.45 per member.
Review the IRS PCORI Fee Rate Chart to help you determine what you may owe. More about what types of plans are required to file, who is responsible for the filing/payment and when the filings must be submitted is available in this guide here. Contact your Higginbotham representative if you need assistance or have questions.
HSA/HDHP Limits Increase for 2020
On May 28, 2019, the IRS released Revenue Procedure 2019-25 to announce the inflation-adjusted limits for HSAs and high deductible health plans (HDHPs) for 2020. These limits include:
- The maximum contribution limit for HSAs;
- The minimum deductible amount for HDHPs; and
- The maximum out-of-pocket expense limit for HDHPs.
These limits vary based on whether an individual has self-only or family coverage under an HDHP.
Eligible individuals with self-only HDHP coverage can contribute up to $3,550 for 2020, while eligible individuals with family HDHP coverage can contribute up to $7,100. The HDHP cost-sharing limits also increase for 2020 – the new minimum HDHP deductibles are $1,400 for self-only coverage and $2,800 for family coverage, while the HDHP maximum out-of-pockets increase to $6,900 for self-only coverage and $13,800 for family coverage.Employer Takeaway
Because the cost-sharing limits for HDHPs change for 2020, employers that sponsor these plans may need to make plan design changes for plan years beginning in 2020. Also, employers that allow employees to make pre-tax HSA contributions should confirm that their benefit election forms have been updated for the HSA contributions limits for 2020.
EEOC Expected to Publish New Wellness Rules in 2019
The Equal Employment Opportunity Commission (EEOC) recently announced its plans to issue new proposed rules on permissible wellness incentives under the Americans with Disabilities Act (ADA) by the end of 2019.
In May 2016, the EEOC issued final rules addressing how the ADA applies to employer-sponsored wellness programs. The final rules included a 30 percent limit for wellness incentives. A federal court vacated this incentive limit, effective Jan. 1, 2019. Consistent with this court ruling, the EEOC removed the incentive limit from its final wellness rules.
The EEOC was expected to issue new proposed rules by June 2019, but the rules have been delayed. The EEOC’s spring regulatory agenda includes a deadline of December 2019 for the proposed rules.
Until the EEOC issues new wellness rules, employers should carefully consider the level of incentives they use with their wellness programs. Employers should also watch for any developments related to the EEOC’s wellness rules.
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