On July 25, Senate Finance Committee Chair Sen. Ron Wyden (D-OR), along with five colleagues, introduced legislation that would impose criminal penalties on “rogue” health insurance advisors who make changes to individuals’ Affordable Care Act (ACA) health insurance without the insureds’ knowledge or consent. The Insurance Fraud Accountability Act would impose fines on brokers who negligently provide incorrect enrollment information, and criminal liability if the provision of incorrect information is “knowingly and willfully false or fraudulent.”

The bill provides for civil fines that would range from $10,000 to $50,000 per applicant, up to a maximum of $200,000. It also allows for up to ten years imprisonment for knowing and willful provision of false or fraudulent information.

Sen. Wyden said his bill “would hold fraudulent insurance brokers and marketers criminally responsible for profiting off of deceptive marketing schemes into health care insurance plans.” He said, “Rogue brokers use misleading advertising, such as touting free government subsidies, to target low-income individuals and enroll them into insurance plans without their permission. Also, brokers switch customers’ insurance plans without ever contacting them. These changes leave customers with uncovered medical expenses, loss of coverage, disruptions in care, and even tax liabilities that could be up to thousands of dollars from their own pockets.”

The bill also creates a consent verification process that will be used in connection with new enrollments in a federal ACA exchange. Verification will also be required when there are coverage changes submitted to the exchange. Coverage changes would include notification to individuals when the exchange receives notification of a change in an individual’s enrollment or agent of record.

The Insurance Fraud Accountability Act was cosponsored by Sens. Sherrod Brown (D-OH), Tammy Duckworth (D-IL), Patty Murray (D-WA), Brian Schatz (D-HI), and Chris Van Hollen (D-MD).

Prospects: Given little time before the 118^th Congress ends and a packed agenda of high-priority legislation, it is unlikely this bill will get a Congressional vote prior to year-end. But it is a bill that bears a close watch, especially during the post-election lame- duck session.

NAIFA Staff Contact: Michael Hedge – Senior Director – Government Relations at mhedge@naifa.org.