11.17.09

Ten State Attorneys General Back Leahy-Authored Antitrust Exemption Repeal Legislation

WASHINGTON  – Ten state Attorneys General are backing legislation authored by Senator Patrick Leahy (D-Vt.) to repeal the health insurance and medical malpractice insurance industries’ exemption from federal antitrust laws.

In a letter dated November 13, Attorneys General from Vermont, Connecticut, Massachusetts, Maine, Oregon, Arizona, Iowa, Montana, Florida and Wyoming urge Congress to end the decades-old exemption from federal antitrust laws, which are designed to encourage competition and protect consumers.  Dating back to the 1945 McCarran-Ferguson Act, health insurers and medical malpractice insurers have been exempt from these laws.  Leahy chairs the Senate Judiciary Committee, which held a hearing on the exemption in October.

“Repeal of the McCarran-Ferguson exemption would enhance competition in health and medical malpractice insurance by giving state enforcers, as well as federal enforcers additional tools to combat harmful anti-competitive conduct,” the Attorneys General wrote.  “Consistent, reasoned enforcement of state and federal antitrust laws benefits market participants as well as enforcers by eliminating uncertainty.”

The letter concludes, “We urge quick action to repeal the McCarran-Ferguson exemption for health and medical malpractice insurers, making antitrust enforcement the same here as for virtually all other industries, thereby enhancing competition to the benefit of consumers.”

In September, Leahy introduced the Health Insurance Industry Antitrust Enforcement Act, which would repeal the exemption for flagrant antitrust violations, including price-fixing, bid rigging and market allocations, and 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.

The Health Insurance Industry Antitrust Enforcement Act is supported by Senate Majority Leader Harry Reid (D-Nev.) and is cosponsored by 14 other Senators.  In October, Leahy announced his intention to introduce the measure as an amendment when the Senate considers health care reform legislation in the coming weeks.

State Attorneys General signing the letter to Leahy include William Sorrell, Vermont; Richard Blumenthal, Connecticut; Martha Coakley, Massachusetts; Janet Mills, Maine; John Kroger, Oregon; Terry Goddard, Arizona; Tom Miller, Iowa; Steve Bullock, Montana; Bill McCollum, Florida; and Bruce Salzburg, Wyoming.  The letter is available online.

The Health Insurance Antitrust Enforcement Act is also supported by the American Dental Association, the Consumer Federation of America, the American Hospital Association, and the American Academy of Pediatrics.

Leahy 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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