The National Club Association has issued an alert regarding a new tax under the health care law. The Clinical Effectiveness Research tax will require clubs whose health plan ends on or before October 1, 2012, to pay $1 per insured life on July 31.
The National Club Association issued an alert regarding a new tax for self-insured clubs under the health care law that will be due July 31. The implementation of the Clinical Effectiveness Research (CER) tax, unlike the Employer Mandate, has not been delayed.
This tax was created to help fund the Patient-Centered Outcomes Research Institute (PCORI), a private, nonprofit corporation created by the government that conducts research to evaluate and compare health outcomes and effectiveness of medical treatments, services, procedures, drugs, etc.
A self-insured club whose health plan ends on or after October 1, 2012, will have to pay $1 per insured life on July 31, 2013.
For those clubs that do not self-insure, this new tax will hit the health insurance provider and be passed on to the club. Though the fee is only $1 per covered life in 2012, $2 per covered life in 2013 and $2 plus an additional increase based on the projected per capita amount of National Health Expenditures for years 2014-2019, clubs will still need to budget for this expense.
For clubs that are self-insured, the fee is collected and reported on IRS Form 720 (Part 2). Each year thereafter, you will need to ensure the fee is paid by that July 31 deadline. The CER tax is only on the books for plan years ending after October 1, 2012 and before October 1, 2019.
For further information, contact NCA’s Vice President of Government Relations and General Counsel, Brad D. Steele, at [email protected] or at 202-822-9822.
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