IRS Releases Proposed Rule on Comparable Effectiveness Research Fees

On April 12, 2012, the Internal Revenue Service (“IRS”) released a proposed rule implementing the comparative effectiveness research fee, which was enacted under the PPACA to fund the Patient-Centered Outcomes Research Institute (“Institute”).  The Institute will conduct research to evaluate and compare health outcomes, and the clinical effectiveness of various medications, treatments, and medical services.  The annual fee applies to plan or policy years on or after October 1, 2012 and before October 1, 2019.  The fee will be payable by the insurer for an insured plan and the plan sponsor in the case of a self-insured plan, and will be based on the number of covered individuals during the applicable period.  The fee is $1 per covered life for the 2012 plan or policy year and $2 per covered life for the 2013 plan or policy year.  The fee will be increased for each applicable year thereafter based on the percentage increase in the projected per capita amount of the National Health Expenditures data released annually by the Department of Health and Human Services.