I 114th CONGRESS 2d Session H. R. 4801 IN THE HOUSE OF REPRESENTATIVES March 17, 2016 Ms. Michelle Lujan Grisham of New Mexico (for herself 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 provisions as fall within the jurisdiction of the committee concerned A BILL To amend title XXVII of the Public Health Service Act, and title XVIII of the Social Security Act, to direct the Secretary of Health and Human Services to conduct audits of medical loss ratio reports submitted by health insurance issuers, and for other purposes.

1. Short title This Act may be cited as the Medical Loss Ratio Accountability Act of 2016 . 2. Audits of medical loss ratio reports submitted with respect to group or individual health insurance coverage Section 2718 of the Public Health Service Act ( 42 U.S.C. 300gg–18 ) is amended— (1) in subsection (b)(3), by inserting , including with respect to the submission of any information that, pursuant to an audit conducted under subsection (f), is found to be untruthful or inaccurate after penalties ; and (2) by adding at the end the following new subsection: (f) Audits (1) In general Beginning with the first plan year that begins after the date of the enactment of the Medical Loss Ratio Accountability Act of 2016, the Secretary shall, with respect to a statistically significant percentage of the reports submitted under this section by health insurance issuers offering group or individual health insurance coverage (including grandfathered health plans), conduct audits of the books and records (or such other information as may be necessary) of such health insurance issuers to verify that the information contained in each such report is truthful and accurate. (2) Selection of reports for audits In selecting reports to be audited under paragraph (1), the Secretary shall ensure that, for a plan year, the health insurance issuers whose reports are selected for such audits are representative of the health insurance issuers that submitted such reports for such plan year. (3) Authority to enter into contracts or cooperative agreements The Secretary may, for purposes of conducting audits under paragraph (1), enter into a contract or cooperative agreement with a private entity. (4) Report to Congress Beginning 18 months after the date of the enactment of the Medical Loss Ratio Accountability Act of 2016 and each year thereafter, the Secretary shall submit to Congress a report on the results of audits conducted under this section with respect to the previous plan year. . 3. Application to parts C and D of the Medicare program Section 1857(e)(4) of the Social Security Act ( 42 U.S.C. 1395w–27(e)(4) ) is amended by adding at the end the following new flush sentence: In the case that audits have been conducted by the Secretary (such as the audits conducted under section 2718(f) of the Public Health Service Act) of the books and records (or of such other information as may be necessary) of an MA plan for a contract year that begins on or after the date of the enactment of the Medical Loss Ratio Accountability Act of 2016, a determination that is made under this paragraph for such MA plan for such contract year shall be based upon one or more reports (or other submissions of information) by the MA plan with respect to which the Secretary has verified, through such audits of such MA plan, that the information contained in such reports (or other submissions) is truthful and accurate. .