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House Dems target insurers' antitrust exemption
House Democrats reintroduced a bill Tuesday that would revoke the health insurance industry's exemption from antitrust laws — a liberal priority that failed to make the cut for President Obama's healthcare reform law.
Reps. Peter DeFazio (D-Ore.) and Louise Slaughter (D-N.Y.) introduced the measure, which would subject health insurers to federal antitrust laws.
"Right now, it is legal under federal law for insurance companies to collude to drive up prices, limit competition, conspire to underpay doctors and hospitals, and price gouge consumers," DeFazio said in a statement. "We must address the rapidly escalating cost of health insurance premiums, and this bill is a great first step."
“The most effective way to contain the out-of-control growth of healthcare costs is to prohibit this collusion between healthcare insurance companies that artificially inflates the price of care, limits competition, and puts an enormous financial strain on American businesses and consumers," Slaughter said in a statement.
America's Health Insurance Plans (AHIP), the leading trade organization for health insurance companies, has slammed the bill in the past as "the triumph of soundbites over substance," saying insurers don't have the sort of exemption Democrats imply thye do.
“There is a fundamental lack of understanding of what the McCarran-Ferguson Act does and does not do," AHIP spokesman Robert Zirkelbach said in a statement. "This Act is extremely limited in scope and has nothing to do with competition within the health insurance industry."
State insurance regulators have said the 1945 law that gave insurers a partial exemption from antitrust laws does not open the door to price-fixing or rigged markets, and the Congressional Budget Office has said the Democrats' bill probably would not affect premiums.
— This post was updated at 4:05 p.m.
