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Proposed regulations on fees imposed with respect to health insurance, health plans

April 12, 2012 | No. 2012-191


The Treasury Department and IRS today released for publication in the Federal Register proposed regulations (REG-136008-11) to implement and provide guidance on the statutory requirements for health insurance policy issuers and plan sponsors of self-insured health plans to fund the Patient-Centered Outcomes Research Institute.

For an electronic version of the 61-page proposed regulations: REG-136008-11

Overview

Under the Patient Protection and Affordable Care Act of 2010, a private, nonprofit corporation—the Patient-Centered Outcomes Research Institute—is established to assist patients, clinicians, purchasers, and policy-makers in making informed health decisions by advancing comparative clinical effectiveness research.

The institute is to be funded by a trust fund which, in turn, will be funded in part by fees paid by issuers of health insurance policies and sponsors of self-insured health plans.

In June 2011, the IRS issued Notice 2011-35, stating that Treasury and the IRS intended to issue proposed regulations to implement and provide guidance on the statutory requirements for issuers and plan sponsors that pay these fees. To assist in the development of the proposed regulations, Notice 2011-35 requested comments on how the fees are to be determined and paid.

Today’s proposed regulations reflect comments made in response to Notice 2011-35, concerning:

  • Specified health insurance policies subject to the fee under section 4375
  • Self-insured health plans and plan sponsors subject to the fee under section 4376
  • Calculation of the fees under sections 4375 and 4375
  • The procedural rules for filing returns, paying fees, and third-party reporting requirements

The regulations are proposed to apply to policy and plan years ending on or after October 1, 2012, and before October 1, 2019. Issuers and plan sponsors may rely on these proposed regulations for guidance pending the issuance of final regulations.

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The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.

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