House of Representatives Approves Repeal of Antitrust Exemption For Health Insurers

By: Michael R. Scott & David Martland with assistance from Brooke Santeramo

On February 24, 2010, the House of Representatives voted overwhelmingly to remove the exemption from federal antitrust laws granted to health insurers by the McCarran-Ferguson Act. Despite the lopsided vote (406 to 19, with most Republicans joining all Democrats), the measure’s prospects in the Senate were described as “uncertain.”[1]

The Health Insurance Industry Fair Competition Act (H.R. 4626) was introduced by freshman Representatives Tom Perriello (D.Va.) and Betsy Markey (D.Col.), fast-tracked to the House floor, and received backing from the White House.[2] It has been widely reported that the bill’s passage represents part of a dual-track strategy of Democratic Party leaders to introduce “incremental” measures addressing particular aspects of health care reform, while simultaneously attempting to find a way forward with more comprehensive measures.[3] While the bill has, not surprisingly, drawn fire from health insurers, the response from the wider insurance industry has been more muted, as its sponsors removed language that would have made the repeal apply to providers of medical malpractice insurance. The bill that passed reaches only health insurers.[4]

Despite the lopsided vote in the House, and the support of the White House, the measure’s fate in the Senate is unclear at the moment. Senator Patrick Leahy (D.Vt.), who has championed earlier Senate efforts to repeal McCarran-Ferguson, on March 4 released a letter to Majority Leader Harry Reid (D.Nev.) signed by him and twenty-one other Democratic and Independent Senators in which Reid is urged to schedule a vote on the House bill “at the earliest opportunity.”[5] However, Senator Ben Nelson (D.Neb.) will presumably oppose the bill, as he did Senator Leahy’s effort to include a similar form of McCarran-Ferguson repeal as an amendment to the Senate’s version of comprehensive health care reform last year. Senator Nelson managed to get the provision removed then, and his position may be even stronger now that Scott Brown (R.Mass.) has been elected to the seat formerly held by Ted Kennedy.[6]

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