As the health care reform debate rages, congressional Democrats stepped up their assault on insurers’s federal antitrust exemption today.
In the House, a bill that would subject both health insurance companies and medical malpractice insurers to federal antitrust laws was voted out of the Judiciary Committee today. And in the Senate, Majority Leader Harry Reid (D-Nev.) and other lawmakers held a news conference to push for the legislation.
The White House and congressional Democrats have made repeal of the 1945 McCarran-Ferguson Act a priority, after negotiations over health care reform with the insurance industry broke down. McCarran-Ferguson allows insurers to be regulated by states instead of the federal government.
The exemption is an “accident of American history,” Sen. Charles Schumer (D-N.Y.) argued at the news conference in the Capitol. The lack of federal antitrust regulation allowed a few national insurers to dominate individual markets and raise prices for consumers, he said.
Over in the House, Judiciary Committee Chairman John Conyers (D-Mich.) said during a markup hearing that Congress “never intended to enact” the kind of immunity that the industry has.
Three House Republicans voted in favor of the bill, but ranking member Lamar Smith (R-Texas) argued that the exemption keeps small insurers in business because it lets them share information they need to compete with larger firms.
Both the Assistant Attorney General for antitrust, Christine Varney, and Reid testified before a Senate Judiciary Committee hearing last week that a repeal would produce more competition and better prices for consumers.
In his weekly radio address on Sunday, President Barack Obama also attacked the exemption, complaining that the industry is “earning these profits and bonuses while enjoying a privileged exemption from our antitrust laws.”
