Malpractice Insurers Prepare For Antitrust Battle

WASHINGTON BUREAU — Medical malpractice insurers are gearing up to keep Senate Democratic leaders from stripping away their McCarran-Ferguson Act antitrust exemption.

Senate Majority Leader Harry Reid, D-Nev., spoke last week at a Senate Judiciary Committee hearing on behalf of S. 1681, a bill introduced by Sen. Patrick Leahy, D-Vt., that would repeal exemption both for health insurers and for medical malpractice insurers.

President Obama suggested Saturday during his weekly address that he personally would like to see the antitrust rules get more attention.

Health insurers are “rolling out the big guns” in a “last-ditch effort to stop reform,” Obama said. “And they’re earning these profits and bonuses while enjoying a privileged exception from our antitrust laws, a matter that Congress is rightfully reviewing.”

Lawrence Smarr, president of the Physician Insurers Association of America, Rockville, Md., said Obama’s comments confirm medical malpractice insurers’ view that the Senate plans to act on the antitrust issue.

Last week, when Reid declared at the Senate Judiciary Committee hearing that, “It is time to pass this legislation and pass it now,” that was a “pretty strong statement,” Smarr says.

The Senate Finance Committee and the Senate Health, Education, Labor and Pensions Committee have both approved major health bill proposals. Reid and others now are trying to draft the version that will go to the Senate floor.

Smarr and others in the insurance industry doubt that S. 1681 will be basis for the antitrust provision in the Senate Democratic leaders’ version of the health reform bill.

But “we believe that Sen. Reid will declare such an amendment in order for Senate floor action,” Smarr says.