I 
109TH CONGRESS 
1ST SESSION H. R. 4103 
To amend title XVIII of the Social Security Act to provide for improved 
accountability in the Medicare Advantage and prescription drug programs. 
IN THE HOUSE OF REPRESENTATIVES 
OCTOBER 20, 2005 
Mr. BROWN of Ohio (for himself, Mr. DINGELL, Mr. RANGEL, Mr. WAXMAN, 
Mr. STARK, and Ms. SCHAKOWSKY) introduced the following bill; which 
was referred to the Committee on Energy and Commerce, and in addition 
to the Committee on Ways and Means, for a period to be subsequently 
determined by the Speaker, in each case for consideration of such provi-
sions as fall within the jurisdiction of the committee concerned 
A BILL 
To amend title XVIII of the Social Security Act to provide 
for improved accountability in the Medicare Advantage 
and prescription drug programs. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Medicare Advantage and Prescription Drug Account-
ability Act of 2005’’. 
(b) TABLE OF CONTENTS.—The table of contents of 
this Act is as follows:
Sec. 1. Short title; table of contents. 
Sec. 2. Requirement for reasonable return of benefits. 
Sec. 3. Financial transparency. 
Sec. 4. Beneficiary sign-off. 
Sec. 5. Annual accountability reports. 
Sec. 6. Auditing of actuarial equivalency. 
Sec. 7. Report comparing costs and benefits under Medicare Advantage plans, 
medicare supplemental policies, and fee-for-service medicare. 
Sec. 8. Annual report on drug claim denials. 
Sec. 9. Medicare Prescription Drug Ombudsman. 
SEC. 2. REQUIREMENT FOR REASONABLE RETURN OF BEN-
EFITS. 
(a) 
MEDICARE
ADVANTAGE
PLANS.—Section 
1857(e) of the Social Security Act (42 U.S.C. 1395w– 
27(e)) is amended by adding at the end the following new 
paragraph: 
‘‘(4) NEGOTIATION FOR LOSS AND ADMINISTRA-
TIVE COST RATIOS.— 
‘‘(A) IN GENERAL.—The contract with an 
MA organization under this part shall provide 
for the following: 
‘‘(i) MINIMUM
LOSS
RATIO.—Aggre-
gate average benefits that are at least a 
minimum ratio of the aggregate average 
revenues collected under the contract. 
‘‘(ii) MAXIMUM ADMINISTRATIVE COST 
RATIO.—Aggregate average administrative 
costs that do not exceed a maximum ratio 
of the aggregate average revenues collected 
under the contract.
‘‘(B) ESTABLISHMENT
OF
RATIOS.—The 
ratios under clauses (i) and (ii) of subpara-
graph (A) shall be established by the Secretary. 
In establishing such ratios, the Secretary shall 
take into account, at a minimum, ratios typical 
of those— 
‘‘(i) under private health insurance 
plans; 
‘‘(ii) under parts A and B of this title; 
and 
‘‘(ii) under health benefits plans of-
fered under chapter 89 of title 5, United 
States Code (relating to the Federal Em-
ployees Health Benefits Program).’’. 
(b) AUDIT OF ADMINISTRATIVE COSTS AND COMPLI-
ANCE WITH THE FEDERAL ACQUISITION REGULATION.— 
Section 1857(d)(2)(B) of such Act (42 U.S.C. 1395w– 
27(d)(2)(B)) is amended— 
(1) by striking ‘‘or (ii)’’ and inserting ‘‘(ii)’’; 
and 
(2) by inserting before the period at the end the 
following: ‘‘, or (iii) to compliance with the require-
ments of subsection (e)(4)(A) and the extent to 
which administrative costs comply with the applica-