Patient-Centered Outcomes Research Institute Fee Calculation

Calculating the Fee

Specified Health Insurance Policies

For issuers of specified health insurance policies, the fee for a policy year ending before October 1, 2013, is $1.00, multiplied by the average number of lives covered under the policy for that policy year.  Generally, issuers of specified health insurance policies must use one of the following four alternative methods to determine the average number of lives covered under a policy for the policy year.

  1. Actual Count Method:  For policy years that end on or after October 1, 2012, issuers using the actual count method may begin counting lives covered under a policy as May 14, 2012, rather than the first day of the policy year, and divide by the appropriate number of days remaining in the policy year.
  2. Snapshot Method:  For policy years that end on or after October 1, 2013, but began before May 14, 2012, issuers using the snapshot method may use counts from the quarters beginning on or after May 14, 2012, to determine the average number of lives covered under the policy.
  3. Member Months Method and 4. State Form Method:  The member months data and the data reported on state forms are based on the calendar year. To adjust for 2012, issuers will use a pro rata approach for calculating the average number of lives covered using the member months method or the state form method for 2012. For example, the issuers using the member months number for 2012 will divide the member months number by 12 and multiply the resulting number by one quarter to arrive at the average number of lives covered for October through December 2012.

For more information on these methods to determine the average number of lives covered under a policy for the policy year, please see the final regulations.

Applicable Self-Insured Health Plans

For plan sponsors of applicable self-insured health plans, the fee for a plan year ending before October 1, 2013 is $1.00, multiplied by the average number of lives covered under the plan for that plan year. Generally, plan sponsors of applicable self-insured health plans must use one of the following three alternative methods to determine the average number of lives covered under a plan for the plan year.

  1. Actual Count Method: A plan sponsor may determine the average number of lives covered under a plan for a plan year by adding the totals of lives covered for each day of the play year and dividing that total by the total number of days in the plan year.
  2. Snapshot Method: A plan sponsor may determine the average number of lives covered under an applicable self-insured health plan for a plan year based on the total number of lives covered on one date (or more dates if an equal number of dates is used in each quarter) during the first, second, or third month of each quarter, and dividing that total by the number of dates on which a count was made.
  3. Form 5500 Method: An eligible plan sponsor may determine the average number of lives covered under a plan for a plan year based on the number of participants reported on the Form 5500, “Annual Return/Report of Employee Benefit Plan,” or the Form 5500-SF, “Short Form Annual Return/Report of Small Employee Benefit Plan.”

However, for plan years beginning before July 11, 2012, and ending on or after October 1, 2012, plan sponsors may determine the average number of lives covered under the plan for the plan year using any reasonable method.

For more information on these methods to determine the average number of lives covered under applicable self-insured health plans for the plan year, please see the final regulations.