WASHINGTON BUREAU — The ERISA Industry Committee (ERIC)- an employer group – is asking the Internal Revenue Service (IRS) to make administration of the new comparative effectiveness research fee as simple as possible.
“The fee and the associated administrative costs are real and immediate, and apply at a time when ERIC’s members are struggling to cope with a mounting roster of expensive health mandates, as well as increasing health care costs,” ERIC President Mark Ugoretz says in a comment letter sent to the IRS.
ERIC submitted the plea for simplicity in response to a request for comment posted by the IRS in June.
The IRS issued the notice to start the process of implementing Section 6301 of the Patient Protection and Affordable Care Act of 2010 (PPACA).
PPACA Section 6301 added Section 9511 – a provision creating a Patient-Centered Outcomes Research Trust Fund — to the Internal Revenue Code (IRC) to provide funding for a new Patient-Centered Outcomes Research Institute (PCORI). The institute is supposed to help the government, private insurers, employers, consumers and providers determine which treatments offer good value for the money spent.
PPACA Section 6301 also added sections 4375, 4376 and 4377 to the Internal Revenue. Those new IRC sections are supposed to pay for the PCORI work by imposing a fee of $2 per life, indexed for the national health care inflation rate, on health insurance policies and “applicable self-insured health plans,” based on the average number of lives covered under the policy or plan.
The fees are supposed to take effect for policy and plan years ending after Sept. 30, 2012.
ERIC is urging the IRS to administer the new fee in a way that avoids duplication and does not require an employer to pay the fee more than once for the same covered individual.
The IRS also should refrain from requiring employers to set up costly systems to determine the actual