n-22-04.pdf

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Sections 4375 & 4376 – Insured and Self-Insured Health Plans
Adjusted Applicable Dollar Amount for Fee Imposed by Sections 4375 and 4376
Notice 2022-4
I. PURPOSE
This notice provides the adjusted applicable dollar amount to be multiplied by the
average number of covered lives for purposes of calculating the fee imposed by
sections 4375 and 4376 of the Internal Revenue Code for policy years and plan years
that end on or after October 1, 2021, and before October 1, 2022.
II. BACKGROUND
Section 4375 imposes a fee on the issuer of a specified health insurance policy
for each policy year ending after September 30, 2012, and before October 1, 2029.
Section 4376 imposes a fee on the plan sponsor of an applicable self-insured health
plan for each plan year ending after September 30, 2012, and before October 1, 2029.
The fee imposed by sections 4375 and 4376 helps to fund the Patient-Centered
Outcomes Research Trust Fund (PCORTF) and is calculated using the average number
of lives covered under the policy or plan and the applicable dollar amount for that policy
year or plan year. Under sections 4375(a) and 4376(a), the applicable dollar amount is
$2 for policy and plan years ending on or after October 1, 2013, and before October 1,
2014.
1
See Treas. Reg. §§ 46.4375-1(c)(4) and 46.4376-1(c)(3).

1
The applicable dollar amount is $1 for policy and plan years ending before October 1, 2013.

2

Under sections 4375(d) and 4376(d) and §§ 46.4375-1(c)(4) and 46.4376-1(c)(3),
the applicable dollar amount for policy years and plan years ending in any Federal fiscal
year beginning on or after October 1, 2014, is increased based on
increases in the projected per capita amount of National Health Expenditures.
Specifically, the applicable dollar amount is the sum of—
(i) The applicable dollar amount for the policy year or plan year ending in the
previous Federal fiscal year; plus
(ii) The amount equal to the product of—
(A) The applicable dollar amount for the policy year or plan year ending
in the previous Federal fiscal year; and
(B) The percentage increase in the projected per capita amount of the
National Health Expenditures, as most recently released by the
Department of Health and Human Services (HHS) before the
beginning of the Federal fiscal year.
Notice 2020-84, 2020-51 IRB 1645, provides that the adjusted applicable dollar
amount for policy years and plan years that end on or after October 1, 2020, and before
October 1, 2021 is $2.66.
III. ADJUSTED APPLICABLE DOLLAR AMOUNT
The applicable dollar amount that must be used to calculate the fee imposed by
sections 4375 and 4376 for policy years and plan years that end on or after October 1,
2021, and before October 1, 2022, is $2.79. Because HHS did not publish updated
National Health Expenditures tables for fiscal year 2021, this year’s fee is calculated
using last year’s projections. This is consistent with the statutory requirement under

3

sections 4375(d)(2) and 4376(d)(2) that the increase to the PCORI fee be determined
by “the percentage increase in the projected per capita amount of National Health
Expenditures, as most recently published by the Secretary before the beginning of the
fiscal year.” Therefore, the increase to the PCORI fee is calculated by multiplying the
adjusted applicable dollar amount for policy years and plan years ending in the previous
Federal fiscal year, $2.66, by the projected percentage increase of the projected per
capita amount of National Health Expenditures for fiscal year 2021, as last published by
HHS on March 19, 2020. See
https://www.cms.gov/Research-Statistics-Data-and-
Systems/Statistics-Trends-and-
Reports/NationalHealthExpendData/NationalHealthAccountsProjected.html, Table 3.
The percentage increase is calculated based on data from the same table that the prior
year’s fee was based on but using data for different years.
IV. EFFECTIVE DATE
This notice is effective for policy years and plan years ending on or after
October 1, 2021, and before October 1, 2022.
V. DRAFTING INFORMATION
The principal author of this notice is William Fischer of the Office of Associate
Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes).
For further information regarding this notice, contact Mr. Fischer at 202–317–5500 (not
a toll-free call).