Insurance Groups to Launch Opposition to Expected McCarran-Ferguson Repeal Amendment

However, legislators plan to add H.R. 5, which would impose federal standards on medical-malpractice lawsuits, as a “pay-for” for the bill.

That is where Gosar’s amendment comes in. He has previously introduced legislation, H.R. 1150, repealing the McCarran-Ferguson Act for purposes of health insurance as well as medical liability insurance, and the industry fears he may offer his legislation as an amendment.

The industry is mobilizing because it fears Gosar’s amendment would be the nose under the camel’s tent.

A flyer the industry intends to circulate to House members cites a Congressional Research Office paper in January 2010 that says, “Passage of any of the measures (the more limited versions impacting health and medical-malpractice insurance) is likely to precipitate litigation to define the scope of the prohibition and/or any remaining exemption.”

The flyer contends, “Repeal of McCarran-Ferguson is anti-competitive.”

It states that McCarran allows insurers, through state oversight of advisory organizations, to share loss-cost data to predict future losses and to develop common policy forms. The Department of Justice has previously determined these activities are permissible because advisory organizations are regulated by state law.

“It is these activities that particularly allow smaller insurers and new-market entrants to properly price their products to cover expected losses and for consumers to be able to easily compare insurance products,” the flyer says.