U.S. Senate votes to repeal federal antitrust enforcement immunity for insurers
The bill will address instances of artificially higher premiums, unfair insurance restrictions and harmful policy exclusions, supporters say.
Flying under the radar of last week’s major spending deal passed and signed by President Trump was a separate bill approved by the Senate that would repeal insurers’ federal antitrust enforcement immunity.
The bipartisan bill amends the McCarran-Ferguson Act to restore the application of federal antitrust laws to the health insurance industry but does not otherwise affect the authority of state authorities to regulate health insurance provided under the act. This bill will help address instances of artificially higher premiums, unfair insurance restrictions and harmful policy exclusions, supporters said. It allows the Justice Department and the Federal Trade Commission to regulate health insurance markets.
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Sen. Steve Daines, a Republican from Montana, said the bill will ensure that health insurance issuers are subject to the same federal antitrust laws prohibiting unfair trade practices, such as price-fixing and collusion, as most other industries.
“Our bipartisan bill will allow for greater transparency and oversight into the health insurance industry and help make health insurance more affordable,” he said. “I look forward to this commonsense bill being signed into law.”
Democratic Sen. Patrick Leahy of Vermont agreed.
“While ordinary Americans are suffering through an unprecedented, deadly pandemic, multi-billion-dollar health insurance companies are boasting record-high profits,” he said. “It makes little sense that these powerful actors should also benefit from an antiquated exemption allowing them to evade all scrutiny and oversight by our federal antitrust authorities. Our overwhelmingly bipartisan bill would simply subject health insurance providers to our federal antitrust laws, just like every other sector of the American economy. It’s a commonsense bill whose time has come, and I hope President Trump swiftly signs it into law.”
However, insurance industry leaders said the repeal will add administrative red tape, reduce market competition and make health coverage less affordable.
“Every American deserves access to affordable coverage that provides them with access to high-quality health care,” Matt Eyles, president and CEO of America’s Health Insurance Plans, said in a statement. “Sadly, eliminating the McCarran-Ferguson Act’s exemption for the business of health insurance will undermine that goal. The McCarran-Ferguson Act recognized that all health care is local and that states should be able to govern their own health insurance markets. At no time has that been more evident than during the COVID-19 crisis. States have always exercised great authority in ensuring fair and competitive markets that delivered consumer choice.
“Removal of this exemption adds tremendous administrative costs while delivering absolutely no value for patients and consumers. It will unnecessarily add layers of bureaucracy, destabilize markets, create conflicting federal and state oversight requirements, and lead to costly litigation.
“We agree with the National Association of Insurance Commissioners on the harms of repealing McCarran-Ferguson and with countless experts that the best way to make insurance premiums more affordable is to address the underlying cost of care. Removal of the McCarran-Ferguson exemptions ignores those cost drivers while raising costs and will only result in coverage being less affordable.”
The legislation advanced with wide bipartisan support this year as large, for-profit insurers are perceived to have benefited from lower health-care volumes in 2020. The 2016 Republican platform proposed doing away with immunity. The House of Representatives passed the bill on Sept. 21. The measure was left out of a massive COVID-19 relief and omnibus spending bill at the end of the year but passed separately by unanimous consent in the Senate.
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