The IRS adjusts the PCORI fee rate every year to reflect changes in national health expenditures. Every year, a number of self-insured employers either miss the update entirely or apply the prior year’s rate to their current filing. The result is an amended return, an IRS notice, or a penalty that was entirely avoidable.
This post covers the current and upcoming PCORI fee rates, who is required to file, how to calculate average covered lives, the July 31 deadline, and your payment options. Whether you are filing for a plan year that ended in 2024 or preparing for a plan year ending in 2025, this guide has what you need.
The Current PCORI Fee Rates
The IRS publishes an updated PCORI fee rate each fall via IRS Notice. The applicable rate depends on when your health plan year ends, not when you file. Two rates are currently in effect:
Plan years ending on or after October 1, 2024, and before October 1, 2025: $3.47 per covered life. This rate applies to non-calendar-year plans with year-end dates between October 1, 2024, and September 30, 2025. Filings for these plan years were due July 31, 2025.
Plan years ending on or after October 1, 2025, and before October 1, 2026: $3.84 per covered life. This rate was confirmed under IRS Notice 2025-61 and represents a $0.37 increase, the largest single-year increase to date. It applies to calendar-year plans ending December 31, 2025, and to non-calendar-year plans with year-end dates between October 1, 2025, and September 30, 2026. Filings for these plan years are due July 31, 2026.
For most employers on a calendar plan year, the rate that applies right now is $3.84 per covered life, with a filing deadline of July 31, 2026.
Applying the wrong rate is one of the most common PCORI filing errors. When in doubt, verify against the most recent IRS Notice or use an e-filing platform that automatically applies the correct rate based on your plan year end date.
Who Is Required to File
The PCORI fee applies to:
- Employers who sponsor self-insured group health plans, including level-funded plans and plans funded through a trust or VEBA
- Employers who offer Health Reimbursement Arrangements (HRAs), including integrated HRAs, stand-alone HRAs, QSEHRAs, and ICHRAs
- Multiple Employer Welfare Arrangements (MEWAs) that are self-funded
- Any plan sponsor whose plan year ended between October 1, 2024, and September 30, 2025 (rate: $3.47), or between October 1, 2025, and September 30, 2026 (rate: $3.84)
The PCORI fee does not apply to employers with fully insured health plans. In a fully insured arrangement, the insurance carrier bears the filing and payment obligation. However, if your organization has both a fully insured major medical plan and a self-insured HRA, the HRA triggers a separate PCORI obligation for the employer. This combination is frequently overlooked.
There is no small-employer exemption. A company with 10 employees and a self-insured plan owes the fee just as much as a company with 10,000.
How Average Covered Lives Is Calculated
The PCORI fee is calculated by multiplying the applicable rate by the average number of covered lives under the plan during the plan year. Covered lives include both employees and their enrolled dependents.
The IRS permits three methods for calculating average covered lives:
Actual Count Method. Count the total number of covered lives for each day of the plan year, then divide by the number of days in the plan year. This is the most precise method but requires daily enrollment data.
Snapshot Method. Count covered lives on one designated date per quarter, then average those counts across the four measurement dates. This is the most widely used method and strikes a practical balance between accuracy and simplicity.
Snapshot Factor Method. Multiply the number of participants with self-only coverage by 1.0 and the number of participants with family coverage by 2.35. Add the results and divide by the number of measurement dates used. This method works well for plans that track enrollment by coverage tier rather than by individual dependent.
Once a calculation method is chosen, it should be applied consistently from year to year. Switching methods is permitted but should be documented.
Note: short plan years do not receive a prorated fee. The full fee based on average covered lives during the short plan year is owed regardless of how many months the plan was in effect.
The July 31 Deadline
The PCORI fee is reported annually on IRS Form 720, Part II, Schedule B. The filing deadline is always July 31 of the year following the plan year end, regardless of the employer’s plan year end date.
For 2026 filers:
- Plan years ending January 2025 through September 2025: rate is $3.47 per covered life, filing deadline was July 31, 2025
- Plan years ending October 2025 through December 2025 (including calendar-year plans): rate is $3.84 per covered life, filing deadline is July 31, 2026
- Plan years ending January 2026 through September 2026: rate is $3.84 per covered life, filing deadline is July 31, 2027
A few additional notes on timing:
- If July 31 falls on a weekend or federal holiday, the deadline shifts to the next business day
- The PCORI fee is reported in the second quarter Form 720 filing only. You do not report PCORI in Q1, Q3, or Q4
- There is no extension available for the PCORI deadline
- The second quarter Form 720 is typically updated by the IRS in Q2 of the filing year. Verify that Line 133 reflects the correct dates and rates before submitting
Missing the July 31 deadline triggers IRS penalties. The failure-to-file penalty is 5 percent of the unpaid tax per month, up to 25 percent. The failure-to-deposit penalty ranges from 2 to 15 percent depending on how late the payment is made. Interest accrues separately on top of any penalties.
Payment: IRS EFTPS vs. E-File
The PCORI fee must be paid electronically through the Electronic Federal Tax Payment System (EFTPS). Paper checks are not accepted for excise tax deposits.
There are two practical approaches:
Manual EFTPS payment. Log in to EFTPS.gov, initiate the payment, and separately submit Form 720 with Schedule B. This two-step process is where errors most commonly occur: filing without paying, or paying without filing, both of which generate IRS notices.
Integrated e-filing. Using an IRS-authorized e-file provider, you complete Form 720 and Schedule B, submit directly to the IRS, and initiate payment within a single workflow. The IRS returns an electronic acknowledgment confirming both the filing and payment instruction have been received.
For most self-insured employers, integrated e-filing is the lower-risk option. It eliminates the coordination gap between filing and payment, provides a timestamped IRS acknowledgment as your compliance record, and takes a fraction of the time of the manual approach.
PCORI Filing Checklist for 2026
Before you file, confirm the following:
- You have identified all self-insured plan components, including any HRAs, that trigger a PCORI obligation
- You have confirmed your plan year end date and matched it to the correct fee rate ($3.47 or $3.84 per covered life)
- You have selected an IRS-approved covered lives calculation method and applied it consistently
- You have verified that Line 133 on the second quarter Form 720 reflects the correct dates and rates for your plan year
- You have completed IRS Form 720, Part II, Schedule B, with the correct employer EIN
- You have arranged EFTPS payment to coincide with the filing submission
- You have retained documentation of the covered lives calculation and payment confirmation for your records
File in Minutes with Akore Federal
Akore Federal’s PCORI e-filing platform is built specifically for self-insured employers who want to get this done accurately and quickly. The platform applies the correct fee rate automatically based on your plan year end date, walks you through the covered lives calculation, populates Schedule B, and submits directly to the IRS with confirmation.
Most employers complete their PCORI filing in under 10 minutes.
Start your PCORI filing at AkoreFederal.com
Questions about which PCORI rate applies to your plan year, or how to calculate average covered lives? Explore our Form 720 resource library or contact the Akore Federal compliance support team.
