SEC. 4. BENEFICIARY SIGN-OFF. 
(a) 
MEDICARE
ADVANTAGE
PLANS.—Section 
1851(c)(2) of the Social Security Act (42 U.S.C. 1395w–
21(c)(2)) is amended by adding at the end the following 
new subparagraph: 
‘‘(C) BENEFICIARY SIGN-OFF IN ELECTION 
PROCESS.—An election to enroll with an MA 
plan shall not be effective unless the election 
form is signed by the individual and specifically 
acknowledges each of the following: 
‘‘(i) The premiums, cost-sharing re-
quirements, and benefits under the plan 
may change at the beginning of each 12-
month contract period. 
‘‘(ii) The individual may lose coverage 
of the individual’s physician or other pro-
vider at the beginning of each such period. 
‘‘(iii) The plan may be terminated at 
the beginning of any such period. 
‘‘(iv) Premiums and benefits under 
the plan may vary based on the county or 
other MA area in which the plan is of-
fered.’’. 
(b) APPLICATION TO PRESCRIPTION DRUG PLANS.—
The amendment made by subsection (a) applies, pursuant 
to section 1860D–1(b)(1)(B)(ii) of the Social Security Act
(42 U.S.C. 1395w–101(b)(1)(B)(ii)), to prescription drug 
plans under part D of title XVIII of such Act. 
(c) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to elections made on or after 
the date specified by the Secretary of Health and Human 
Services, but in no case later than 60 days after the date 
of the enactment of this Act. 
SEC. 5. ANNUAL ACCOUNTABILITY REPORTS. 
(a) MEDICARE ADVANTAGE ACCOUNTABILITY RE-
PORT.—Section 1856 of the Social Security Act (42 
U.S.C. 1395w–26) is amended—
(1) by amending the heading to read as follows: 
‘‘ESTABLISHMENT OF STANDARDS; ANNUAL 
ACCOUNTABILITY REPORT’’; 
and 
(2) by adding at the end the following new sub-
section: 
‘‘(c) ANNUAL ACCOUNTABILITY REPORT.—
‘‘(1) IN GENERAL.—The Secretary shall com-
pile, and transmit to Congress, at the end of each 
year (beginning with 2004), an annual Medicare Ad-
vantage accountability report. 
‘‘(2) CONTENTS.—Each annual accountability 
report shall include the following:
‘‘(A) A detailed analysis of geographic var-
iation in cost-sharing and premiums among MA 
plans. 
‘‘(B) A comparison of the use of amounts 
paid to MA plans for benefit payments, admin-
istrative costs, and profits with the amounts ex-
pended under the fee-for-service programs 
under parts A and B for benefit payments and 
administrative expenses. 
‘‘(C) 
Recommendations 
for 
legislative 
changes to the Medicare Advantage program, or 
the fee-for-service programs under parts A and 
B, to assure that medicare beneficiaries under 
both programs have access to comparable bene-
fits at comparable cost and that Government 
subsidies under the two programs are equiva-
lent. 
‘‘(D) The results of audits conducted 
under section 1857(d) and enforcement actions 
taken in response to findings of inappropriate 
expenditures of funds under this part.’’. 
(b) PRESCRIPTION
DRUG
ACCOUNTABILITY
RE-
PORT.—Section 1860D–12 of such Act (42 U.S.C. 
1395w–112) is amended by adding at the end the fol-
lowing new subsection:
‘‘(h) ANNUAL ACCOUNTABILITY REPORT.—
‘‘(1) IN GENERAL.—The Secretary shall com-
pile, and transmit to Congress, at the end of each 
year (beginning with 2006), an annual prescription 
drug accountability report. 
‘‘(2) CONTENTS.—Each annual accountability 
report shall include the same types of information 
(as specified by the Secretary) with respect to pre-
scription drug plans as are provided under subpara-
graphs (A), (B), and (D) of section 1856(c)(2) with 
respect to MA plans.’’. 
SEC. 6. AUDITING OF ACTUARIAL EQUIVALENCY. 
(a) 
MEDICARE
ADVANTAGE
PLANS.—Section 
1854(a)(5) of the Social Security Act (42 U.S.C. 1395w–
24(a)(5)) is amended by adding at the end the following 
new subparagraph: 
‘‘(B) PERIODIC
AUDITS
OF
ACTUARIAL 
EQUIVALENCY DETERMINATIONS.—In the case 
of MA plans that provide for an actuarially 
equivalent level of benefits under this part, the 
Inspector General of the Department of Health 
and Human Services shall periodically audit a 
representative sample of the determinations 
made by the Secretary regarding such actuarial 
equivalency to ensure that the Secretary is only