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119-hr-8442119th CongressWALLET

Patient Refunds for Bad Denials Act of 2026

Sponsored By: Representative Craig, Angie [D-MN-2]

Introduced

Summary

Civil penalties for insurers with high claims denial rates would be created, and insurers would have to give denied claimants the issuer’s medical necessity standards and a written explanation for denials. The bill targets plan years beginning on or after January 1, 2027 and lets the Secretary audit denial rates and set or lower the threshold as needed.

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  • Families and patients could get money back when an issuer’s denial rate meets the threshold. Penalties collected would be distributed pro rata to enrollees for the affected plan year, and denied claimants must receive an explanation of the medical necessity standards used.
  • Health insurance issuers would face audits and a civil monetary penalty if their claims denial percentage is 25 percent or higher. Penalties would start at $10.0 million plus $2.0 million for each percentage point above 25 percent, with the Secretary able to account for issuer efforts to reduce denials.
  • The Secretary of Health and Human Services would audit plans to calculate denial rates, could exclude correctly denied fraud or nonmedical necessity claims from the denominator, could set a lower threshold, and may adjust penalty amounts for inflation starting in 2028.

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Bill Overview

Analyzed Economic Effects

1 provisions identified: 0 benefits, 0 costs, 1 mixed.

Fines for insurers, refunds to enrollees

If enacted, this bill would let HHS penalize health insurers that deny many claims. For plan years starting on or after January 1, 2027, an issuer with a claims denial percentage of 25% or more could face a base penalty of $10,000,000. The penalty would rise by $2,000,000 for each percentage point above 25%. The Secretary could audit reported denial rates, may set a lower denial threshold, and may adjust dollar amounts for inflation after 2027. Correctly denied claims for fraud or lack of medical necessity would not count toward the denial percentage, but fraud denials require issuer proof. Amounts collected would be split pro rata to people who were enrolled in the issuer’s plans for the plan year. Issuers would also have to give people denied for lack of medical necessity their medical-necessity standards and an explanation.

Sponsors & CoSponsors

Sponsor

Craig, Angie [D-MN-2]

MN • D

Cosponsors

  • Rep. Ryan, Patrick [D-NY-18]

    NY • D

    Sponsored 4/22/2026

Roll Call Votes

No roll call votes available for this bill.

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