June 2025 HR Update

PCORI Fees Due July 31, 2025

The Affordable Care Act (ACA) requires health insurance issuers and self-insured plan sponsors to pay Patient-Centered Outcomes Research Institute (PCORI) fees. The fees are reported and paid annually using IRS Form 720 (Quarterly Federal Excise Tax Return).

Form 720 and complete payment of the PCORI fees are due by July 31 of each year and generally cover plan years that end during the preceding calendar year. For plan years ending in 2024, the PCORI fees are due by July 31, 2025.

The PCORI fees, scheduled to expire for plan years ending on or after Oct. 1, 2019, have been extended for 10 years thanks to a federal spending bill enacted at the end of 2019. As a result, these fees will continue to apply for the 2020-2029 fiscal years.

Calculating the PCORI Fee Payment

The PCORI fees are generally assessed, collected and enforced like taxes. The PCORI fee applies separately to “specified health insurance policies” and “applicable self-insured health plans” and is based on the average number of lives covered under the plan or policy (see more information here). As a reminder, the fee is paid based on the month your plan year ended, not the date it started (for example, a plan that renewed on Jan. 1, 2025, technically ended on Dec. 31, 2024). See the chart below for easy reference.

Employer Takeaway

Using Part II, Number 133 of Form 720, issuers and plan sponsors must report the average number of lives covered under the plan separately for specified health insurance policies and applicable self-insured health plans. Multiply that number by the appropriate rate for the tax year—$3.22 for plan years ending on or after October 1, 2023, and before October 1, 2024, or $3.47 for plan years ending on or after October 1, 2024, and before October 1, 2025. The fees for specified health insurance policies and applicable self-insured health plans are combined to equal the total tax owed and submitted before July 31.

Please contact your Higginbotham representative if you need assistance calculating the fees owed this year or for previous years.

EEOC Opens EEO-1 Reporting Portal for 2024 Data; Reports Due June 24

The portal for employers to submit 2024 EEO-1 Reports to the U.S. Equal Employment Opportunity Commission (EEOC) opened on May 20, 2025. The deadline to file 2024 EEO-1 Reports is June 24, 2025.

EEO-1 Overview

The EEO-1 Report is a federally mandated survey that collects workforce data categorized by race, ethnicity, sex and job category. Under Title VII of the Civil Rights Act, covered employers must usually submit EEO-1 Reports by March 31. However, the EEOC pushed the deadline for 2024 EEO-1 Reports to June 24, 2025.

Covered Entities

The following entities are subject to EEO-1 reporting:

A private employer that has 100 or more employees (with limited exceptions for schools and other organizations);
A private employer with between 15 and 99 employees, if it is part of a group of employers that legally constitutes a single enterprise that employs a total of 100 or more employees and
A federal contractor with 50 or more employees is either a prime contractor or first-tier subcontractor and has a contract, subcontract or purchase order amounting to $50,000 or more.

Although President Donald Trump revoked Executive Order (EO) 11246, which required federal contractors with 50 or more employees to submit EEO-1 Reports, the EEO-1 instructions still refer to EO 11246 and specify that such contractors must submit 2024 EEO-1 Reports.

Removal of Nonbinary Reporting Option

In prior EEOC instructions, covered entities could voluntarily report the number of employees who self-reported as nonbinary when indicating their sex. The 2024 EEO-1 instructions remove this option and require employers to report each employee’s sex as either male or female.

Employer Takeaway

Employers subject to EEO-1 reporting requirements should begin submitting 2024 EEO-1 data in the portal and complete their submissions by June 24, 2025. Employers may also review the following for additional information:

The EEOC’s online filer help desk is available starting May 20, 2025, to assist filers with any questions regarding the 2024 collection.

Although the EEOC sends electronic notifications to employers it knows to be subject to the EEO-1 requirements, all employers are responsible for obtaining and submitting the necessary information before the deadline.

Trump Administration Will Not Enforce 2024 Final Rule on Mental Health Parity

On May 15, 2025, the U.S. Departments of Labor, Health and Human Services, and the Treasury (Departments) released a statement regarding the nonenforcement of the 2024 final rule under the Mental Health Parity and Addiction Equity Act (MHPAEA). The statement relates to a lawsuit by an employer trade group seeking to invalidate the final rule. The litigation has been put on hold while the Departments reconsider the final rule, including whether to modify or rescind it altogether.

According to the Departments’ statement, they will not enforce the 2024 final rule (or otherwise pursue enforcement actions) based on a failure to comply that occurs before a final decision in the litigation, plus an additional 18 months. The Departments are also reexamining their MHPAEA enforcement program more broadly.

2024 Final Rule

On Sept. 9, 2024, the Departments released a final rule to strengthen MHPAEA’s requirements. MHPAEA requires parity between a group health plan’s medical/surgical (M/S) benefits and mental health/substance use disorder (MH/SUD) benefits.

The final rule’s extensive changes focus on nonquantitative treatment limitations (NQTLs). NQTLs include a variety of strategies that generally limit the scope or duration of benefits, such as prior authorization requirements. Among other changes, the final rule requires health plans and health insurance issuers to:

Offer meaningful benefits, including a core treatment, for each covered mental health condition or substance use disorder in every classification where you offer medical/surgical benefits, including a core treatment;
Not use factors and evidentiary standards to design NQTLs that discriminate against MH conditions and SUDs;
Collect and evaluate relevant outcomes data and take reasonable action, as necessary, to address material differences in access to MH/SUD benefits as compared to M/S benefits and
Include specific elements in comparative analyses of NQTLs.

The final rule generally applies for plan years beginning on or after Jan. 1, 2025; however, specific key requirements, such as NQTL data evaluation requirements, apply for plan years beginning on or after Jan. 1, 2026.

Employer Takeaway

Employer-sponsored health plans should continue to comply with MHPAEA’s statutory requirements, including the comparative analysis requirement for NQTLs, and may refer to the 2013 final rule for compliance guidance. We will continue to monitor updates regarding any modifications to the 2024 final rule.

June 2025 HR Update