§4376 — Title 26 Internal Revenue Code | U.S. Code

Summary

Employers and other sponsors of self-insured health plans — plans that pay health claims directly instead of buying an insurance policy — owe a yearly fee based on the average number of people the plan covers. The base fee is $2 per covered life, and it rises each year with the growth in projected per-person national health spending, so the current amount is higher than $2. The plan sponsor pays the fee: the employer for a single-employer plan, the union for a union plan, or the board or association that runs a joint or multi-employer plan. The fee covers plans set up by employers, employee organizations, voluntary employees' beneficiary associations, certain trade groups, and some cooperatives. It does not apply to plan years ending after September 30, 2029.

Title 26, §4376

Internal Revenue Code — Source: USLM XML via OLRC

(a)In the case of any applicable self-insured health plan for each plan year ending after September 30, 2012, there is hereby imposed a fee equal to $2 ($1 in the case of plan years ending during fiscal year 2013) multiplied by the average number of lives covered under the plan.

(b)(1)The fee imposed by subsection (a) shall be paid by the plan sponsor.

(2)For purposes of paragraph (1) the term “plan sponsor” means—

(A)the employer in the case of a plan established or maintained by a single employer,

(B)the employee organization in the case of a plan established or maintained by an employee organization,

(C)in the case of—

(i)a plan established or maintained by 2 or more employers or jointly by 1 or more employers and 1 or more employee organizations,

(ii)a multiple employer welfare arrangement, or

(iii)a voluntary employees’ beneficiary association described in section 501(c)(9), the association, committee, joint board of trustees, or other similar group of representatives of the parties who establish or maintain the plan, or

(D)the cooperative or association described in subsection (c)(2)(F) in the case of a plan established or maintained by such a cooperative or association.

(c)For purposes of this section, the term “applicable self-insured health plan” means any plan for providing accident or health coverage if—

(1)any portion of such coverage is provided other than through an insurance policy, and

(2)such plan is established or maintained—

(A)by 1 or more employers for the benefit of their employees or former employees,

(B)by 1 or more employee organizations for the benefit of their members or former members,

(C)jointly by 1 or more employers and 1 or more employee organizations for the benefit of employees or former employees,

(D)by a voluntary employees’ beneficiary association described in section 501(c)(9),

(E)by any organization described in section 501(c)(6), or

(F)in the case of a plan not described in the preceding subparagraphs, by a multiple employer welfare arrangement (as defined in section 3(40) of Employee Retirement Income Security Act of 1974), a rural electric cooperative (as defined in section 3(40)(B)(iv) of such Act), or a rural telephone cooperative association (as defined in section 3(40)(B)(v) of such Act).

(d)In the case of any plan year ending in any fiscal year beginning after September 30, 2014, the dollar amount in effect under subsection (a) for such plan year shall be equal to the sum of such dollar amount for plan years ending in the previous fiscal year (determined after the application of this subsection), plus an amount equal to the product of—

(1)such dollar amount for plan years ending in the previous fiscal year, multiplied by

(2)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.

(e)This section shall not apply to plan years ending after September 30, 2029.

Editorial Notes

References in Text

section 3(40) of Employee Retirement Income Security Act of 1974, referred to in subsec. (c)(2)(F), is classified to section 1002(40) of Title 29, Labor.

Amendments

2019—Subsec. (e). Pub. L. 116–94 substituted “2029” for “2019”.

§4376 Self-insured Health Plans

Summary

Title 26, §4376

Notes & Related Subsidiaries

Editorial Notes

References in Text

Amendments

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