Optional health deal

If Congress passes a healthcare bill without the public option, it should be called the Insurance Industry Windfall Profit Act — and Congress should repeal the antitrust exemption for the insurance industry.

In fact, the antitrust exemption should be repealed regardless of what happens with the healthcare bill.

Imagine passing a law that defines price-fixing, collusion and market allocation as legal and promoted by government policy. Guess what? That is the law today, because the industry is exempt from antitrust law.

The president eloquently describes the abuses under the current system. Members of the House and Senate speak eloquently about constituents who suffer abuse.

Yet the president and Congress allow the continuation of policies that legalize what for other industries is illegal.

The current oligopolistic structure of the industry makes repeal of the antitrust exemption even more compelling. In state after state, the insurance business is dominated by one or two companies. The situation that antitrust laws are designed to prevent is exactly the situation that exists today in market after market throughout the nation.

If the president and Congress want to stand up for those suffering abuse, they should stand against the practices that promote these abuses. To continue the exemption is a license for price-fixing, collusion and market allocation to continue, along with the abuses they promote.

If opponents of the public option are confident their policies will protect consumers, they have nothing to fear by repealing the antitrust exemption. If there are no violations of the law, there will be no successful antitrust cases brought.

While it remains unclear what the president’s true position on the public option is, what he says is true. It is the public option that creates the real choice and the true check and balance against private-industry abuses.

If Congress merely forces consumers to buy policies from private insurers, and then imposes punishment against consumers who don’t buy private-market products, the result will be maximum profits to insurers and minimum protection for consumers.

Insurance co-ops are valuable and should be supported, but there is no evidence that co-ops would offer the kind of large-sized competition that a public option would provide. The evidence over many years is exactly the opposite. If you believe co-ops are a legitimate alternative to the public option to provide a check and balance against industry abuse, I’ve got some toxic assets to sell you.

In a recent poll, more than 75 percent of respondents expressed support for a public option for those who cannot get private insurance. Surely a Democratic president and Democratic Congress can summon the policy sense and political courage to stand with three-fourths of the nation, and surely there are one or two Republicans who can support a bill that is less enlightened than the program proposed by President Richard Nixon.

So here is the deal. The insurance industry should accept a public option, and in return, Congress can allow the antitrust exemption to continue. If not, the exemption should be ended. That or some future president and Congress will have to clean up the mess, and voters will be unhappy campers as abuses continue.

Budowsky was an aide to former Sen. Lloyd Bentsen and Bill Alexander, then chief deputy majority whip of the House. He holds an LL.M. degree in international financial law from the London School of Economics. He can be read on The Hill’s Pundits Blog and reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .