ADA urges lawmakers to reexamine McCarran-Ferguson
April 12, 2016
— The ADA submitted written testimony
April 12 to the Senate Judiciary subcommittee on antitrust, competition policy and consumer rights, urging committee members to reexamine the antitrust exemption enjoyed by health insurance companies as a result of the 1945 McCarran-Ferguson law.
“The current debate regarding health care reform requires serious consideration of any and all means to introduce competition and make health insurance affordable for all Americans,” wrote the Association, which has long contended the ability to collude on payments gives health insurance companies an unfair competitive advantage.
“An important step toward achieving these objectives is eliminating the outdated antitrust exemption that grants health insurers special status, and permits them to ignore the competitive rules that apply to every other U.S. business.”
The state action doctrine, the Association said, provides a “more comprehensive and systemic solution to the problem the McCarran-Ferguson Act was originally intended to address — i.e., state and federal regulatory conflict — so that the Act exists today primarily as an historical vestige whose complicated terms have resulted in misinterpretation and mischief.”
The Association concluded by saying it “strongly supports” the Competitive Health Insurance Reform Act
, introduced last year by Rep. Paul Gosar. That bill would authorize the Federal Trade Commission and the Justice Department to “enforce the federal antitrust laws against health insurance companies engaged in anticompetitive conduct” and would not interfere with the states’ ability to enforce their own regulations, antitrust statues and consumer protection laws.
“When competition is not robust, consumers are more likely to face higher prices and less likely to and less likely to benefit from innovation and variety in the marketplace.”