U.S. House Passes Bill to End 65-Year Old Anti-Trust Exemption for Health Insurance Companies
February 24, 2010
This afternoon, the House of Representatives passed The Health Insurance Industry Fair Competition Act, which will take away the anti-trust exemption for health insurance companies, requiring them to compete fairly and adhere to the same anti-trust laws as other companies.
“Families throughout the 9th District are facing higher health insurance premiums, lower quality of coverage and limited choices – all while the insurance companies are jacking up prices and turning record profits,” Congressman Cohen said. “I voted to repeal this exemption for health insurers so that individuals, families, and small business owners get a fair deal when deciding on their health insurance plan.”
For 65 years, the health insurance industry has been legally exempt from anti-trust laws and the federal government was banned from even investigating evidence of possible collusion. In the past 14 years there have been 400 mergers among health insurers. This has resulted in 94% of all insurance markets being “highly concentrated” – meaning consumers have little or no choice between insurance providers.
Health insurers that were previously exempt from anti-trust laws will now bear legal responsibility for price fixing, dividing up territories among themselves and sabotaging their competitors in order to gain a monopoly in the marketplace. Such practices have been outlawed in other industries for decades.
“There are only two industries that are exempt from anti-trust laws – the insurance industry and major league baseball,” Congressman Cohen said. “Competition is the core principle of our economy. For consumers, it’s a guarantee of two things: more choices and lower costs. It is the motivator that drives economic growth, spurs American innovation and ensures that consumers are getting a fair deal. This bill creates a fair health insurance marketplace and helps put our economy on sound footing for the future.”
The legislation is supported by numerous groups including the American Hospital Association, American Nurses Association, American Academy of Pediatrics, Consumers Union, Consumer Federation of America, U.S. PIRG, and the Center for Justice and Democracy.
________________________
Steven Broderick
Communications Director
Congressman Steve Cohen (TN-9)
1005 Longworth House Office Building
Washington, DC 20515
Direct: 202-226-7916
Main: 202-225-3265
steven.broderick@mail.house.gov
“Families throughout the 9th District are facing higher health insurance premiums, lower quality of coverage and limited choices – all while the insurance companies are jacking up prices and turning record profits,” Congressman Cohen said. “I voted to repeal this exemption for health insurers so that individuals, families, and small business owners get a fair deal when deciding on their health insurance plan.”
For 65 years, the health insurance industry has been legally exempt from anti-trust laws and the federal government was banned from even investigating evidence of possible collusion. In the past 14 years there have been 400 mergers among health insurers. This has resulted in 94% of all insurance markets being “highly concentrated” – meaning consumers have little or no choice between insurance providers.
Health insurers that were previously exempt from anti-trust laws will now bear legal responsibility for price fixing, dividing up territories among themselves and sabotaging their competitors in order to gain a monopoly in the marketplace. Such practices have been outlawed in other industries for decades.
“There are only two industries that are exempt from anti-trust laws – the insurance industry and major league baseball,” Congressman Cohen said. “Competition is the core principle of our economy. For consumers, it’s a guarantee of two things: more choices and lower costs. It is the motivator that drives economic growth, spurs American innovation and ensures that consumers are getting a fair deal. This bill creates a fair health insurance marketplace and helps put our economy on sound footing for the future.”
The legislation is supported by numerous groups including the American Hospital Association, American Nurses Association, American Academy of Pediatrics, Consumers Union, Consumer Federation of America, U.S. PIRG, and the Center for Justice and Democracy.
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________________________
Steven Broderick
Communications Director
Congressman Steve Cohen (TN-9)
1005 Longworth House Office Building
Washington, DC 20515
Direct: 202-226-7916
Main: 202-225-3265
steven.broderick@mail.house.gov
Issues:Health Care