House, Senate Dems Push Antitrust Repeal

October 21, 2009

House, Senate Dems Push Antitrust Repeal
October 21, 2009
By: Andrew Noyes and Dan Friedman
The House Judiciary Committee today voted 20-9 to approve legislation aimed at repealing antitrust exemptions for health insurers, and Senate Democratic leaders said they would push for a similar provision to be included in healthcare overhaul legislation.

House, Senate Dems Push Antitrust Repeal
October 21, 2009
By: Andrew Noyes and Dan Friedman
The House Judiciary Committee today voted 20-9 to approvelegislation aimed at repealing antitrust exemptions for healthinsurers, and Senate Democratic leaders said they would push for asimilar provision to be included in healthcare overhaul legislation.
"Providing antitrust exemptions for insurance companies has been anti-competitive and damaging to the American family and the American economy," Senate Majority Leader Reid said at a morning news conference with Senate Judiciary Chairman Patrick Leahy and Sen. Charles Schumer, D-N.Y.
The House panel's vote came despite Republican efforts to characterize the measure as a ploy to weaken the powerful industry's opposition to components of the broader healthcare overhaul.
Rep. Bob Goodlatte, R-Va., said the antitrust bill would not stimulate competition, contrary to the arguments of House Judiciary Chairman John Conyers and his co-sponsors.
Instead he called the measure a "gross misrepresentation of what is really going on." Goodlatte and Judiciary ranking member Lamar Smith said the committee's time would be better spent addressing tort reform.
The 1945 McCarran-Ferguson Act allows small and medium-sized insurers to aggregate information for underwriting purposes, which Smith said allows them to compete with larger providers.
"We must be very careful of unintended consequences," Smith said. "It's doubtful that this legislation will do anything beneficial for the customer."
But Conyers and his allies argued the immunity provided by the statute was supposed to be temporary and needs to end. Rep. Anthony Weiner, D-N.Y., said the health insurance industry has benefited from inefficiencies in the marketplace.
Rep. Diana DeGette, D-Colo., said she is working with Conyers to get the antitrust language folded into the broader health reform package.
In the Senate, Reid and Leahy are longtime backers of the change, though their plan to attach the measure to the broader healthcare bill is a new step. Some senators might view its addition as retaliation against insurers who in recent weeks have stepped up opposition to Democratic plans to overhaul health coverage.
"This is something that is quite popular in the Caucus. We'll have to wait and see what happens," Schumer said.
In a letter today to Leahy and Conyers, Karen Ignagni, president of America's Health Insurance Plans, said the House and Senate proposals "attempt to remedy a problem that does not exist."
Ignagni argued that the McCarran-Ferguson Act does not free insurers to engage in anti-competitive conduct, as Reid and Leahy assert, and that insurers are not doing so. Ignagni also said that changing the federal law would bring it into conflict with state regulations, causing confusion.
"We ask you to consider our strong concerns that such legal uncertainty could chill or limit newly developing activities that will benefit consumers and doctors ... and add to the already substantial cost that litigation imposes on the health care system," she wrote.
Both the White House and Senate Democrats have blasted Ignagni over an AHIP-commissioned study asserting the Senate Finance Committee's healthcare proposal would lead to higher health insurance premiums.