Leahy Bill Repeals Antitrust Exemption for Malpractice, Health Insurance Companies

September 18, 2009

Senate Judiciary Committee Chairman Patrick Leahy, D-Vt. has introduced legislation to eliminate a federal antitrust exemption for health insurance and medical malpractice insurance companies.

As the Senate prepares to consider comprehensive health care reform legislation, Leahy introduced the Health Insurance Industry Antitrust Enforcement Act to repeal the antitrust exemption that was established in the 1945 McCarran-Ferguson Act.

“A few industries have used their influence to obtain a special, statutory exemption from the antitrust laws, and the insurance industry is one of them,” said Leahy. “In the markets for health insurance and medical malpractice insurance, patients and doctors are paying the price, as costs continue to increase at an alarming rate. Insurers should not object to being subject to the same antitrust laws as everyone else.”

The two key provisions of the Health Insurance Industry Antitrust Enforcement Act will repeal the federal antitrust exemption for health insurance and medical malpractice insurance companies for price-fixing, bid rigging, and market allocations. Leahy said his bill would “subject health insurers and medical malpractice insurers to the same good-competition laws that apply to virtually every other company doing business in the United States.”

This is not Leahy’s first stab at changing the antitrust law. He has introduced legislation to repeal the McCarran-Ferguson Act in previous Congresses, including the 2007 bipartisan Insurance Industry Competition Act, which provided for a broader repeal of the McCarran-Ferguson Act.

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