On May 23, Representative Peter DeFazio (D-Or) introduced the “Health Insurance Industry Fair Competition Act,” (H.R. 1943). The bill would repeal the antitrust exemption that health insurers currently enjoy under the McCarran Ferguson Act (15 USC 1011 et seq.) and also make non-profit health insurers subject to Section 5 of the Federal Trade Commission Act, which prohibits unfair methods of competition.
Representative DeFazio has long advocated the repeal of the McCarran Ferguson Act’s antitrust exemption, having introduced such legislation in every Congress for the last 8 years. His efforts came closest to fruition last Congress, when his repeal bill was passed in the House by a vote of 406 to 19, but was not acted on by the Senate before the close of the session. (DeFazio’s McCarran repeal language was also included in the health care reform bill that ultimately became the Affordable Care Act, but was dropped during the negotiations with the Senate prior to passage of the bill into law).
In introducing the legislation this Congress, Representative DeFazio stated that “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,” and reiterated his view that “Insurance companies should play by the same rules as virtually every other industry in America.” He continued: “If 406 members could support this last year, there’s no reason to not pass it again this year.” Representative Louise Slaughter (D-NY), a co-sponsor of the bill, added that “It’s well past time that Congress act to strike this sweetheart deal. The last Congress knew this to be a bipartisan and sensible proposition. I hope this Congress knows that as well.”
H.R. 1943 has been referred to the House Judiciary Committee for further action, and joins H.R. 1150, a similar McCarran repeal bill that was introduced by Representative Paul Gosar of Arizona in March. Representative Gosar’s bill is now pending before the Judiciary Committee’s Subcommittee on Intellectual Property, Competition and the Internet, having been referred there for further study on June 1. Notably, Representative Gosar is a Republican, so with McCarran repeal bills now having been introduced from both sides of the aisle, the likelihood that McCarran repeal will once again advance this Congress is greatly increased. In short, it appears that the McCarran repeal ride has begun again, and where it ends is, again, highly uncertain.