Democrats in the House are pushing to repeal the limited antitrust exemption afforded to healthcare and medical liability insurers. They said that in the absence of a “public option” in health insurance reform legislation, repealing the antitrust exemption is one obvious cost-cutting tool.

In response, the National Association of Insurance Commissioners (NAIC) last week sent a letter to House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid saying “it is unlikely that a repeal of the McCarran-Ferguson antitrust exemption for health and medical malpractice insurers will lead to more competition and lower premiums,” as supporters of the repeal have argued that it would. The National Association of Mutual Insurance Companies registered its opposition to the repeal.

The repeal of McCarran-Ferguson has been championed by Sen. Patrick Leahy (D-Vt.), who first offered it as a separate bill and then attempted to get it incorporated in the Senate healthcare reform bill. That effort failed. Now that Senate and House bills must be reconciled, some House members are pushing for its inclusion.

“Under the regulatory regime that arose from the McCarran-Ferguson Act, more than 5,000 property/casualty insurers across the country are subject to a comprehensive and pervasive regimen of state-based regulation and antitrust enforcement, including health and medical malpractice insurance,” said a letter to Congress signed by PIA and coalition partners. “States regulate virtually every aspect of insurance, including licensing, market conduct, financial solvency, policy language and underwriting standards. Thus, federal action to repeal or amend the McCarran-Ferguson Act for these or any line of insurance is unnecessary to pursue any allegations of anti-competitive behavior.”

PIA Assists Industry Coalition Working to Oppose Antitrust Repeal Effort

January 13, 2010