Information about the Comparative Effectiveness Research Fee in 2019

The Affordable Care Act imposes an annual fee called the Comparative Effectiveness Research Fee (CERF) on insurers and plan sponsors of self-insured coverage to help fund the Patient-Centered Outcomes Research Institute (PCORI). This post includes a brief review of CERF.

CERF Payment Details
The fee is based on the average covered lives for the applicable 12-month policy or plan year. It is paid using IRS Form 720 by July 31 each year for the plan year that ended in the preceding calendar year. As a reminder, employers must use their ERISA plan year if it is different from the renewal date. The fees for 2019 are:

Plan Year Start DateFee Per Average Covered Life
Feb. 1, 2017–Oct. 1, 2017$2.39
Nov. 1, 2017–Jan. 1, 2018$2.45

Who Is Responsible for Paying?

  • The insurance carrier pays the fee for fully insured plans (including guaranteed cost, shared returns, and minimum premium plans), and it is built into premiums (some carriers will show these fees broken out in their proposals).
    • Health Reimbursement Accounts (HRAs) and certain Flexible Spending Accounts (FSAs) are considered self-funded group health plans. Most insurance carriers will pay the fee for the underlying medical policy only; clients are responsible for the HRA/FSA related fee.
  • Self-funded plans (including level funding and graded preferred plans) must calculate and pay their own fee. Some insurance carriers will pay this fee on your behalf, so check with your carrier or broker for clarification on who is responsible for payment.

If your organization has a Self-funded, Level Funded, or similar plan, and if you are responsible to pay the fee, you’ll need to calculate the amount of fee due and submit it per the forms mentioned above. Most insurance carriers will provide reporting to assist you in calculating the fee due.