The House today passed legislation that included an amendment repealing the antitrust exemption for health insurers contained in the McCarran-Ferguson Act.
However, the amendment was significantly narrowed to explicitly exempt property and casualty and life products, as well as products allied with them, including workers’ compensation insurance.
Property and casualty and life insurance companies, which mobilized starting last week to try to either kill or modify the bill, noted their concerns in reacting to the vote.
Melissa Shelk, vice president for federal affairs at the American Insurance Association, said that, “Any attempts to broadly repeal McCarran-Ferguson are misguided and could have unintended consequences that, ironically, could stifle market competition while promoting regulatory uncertainty and increased litigation.”
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She added that, “While we would prefer to see McCarran left intact, the amendment’s author recognized that property-casualty insurance products, along with other non-health insurance lines, should be exempted from the amendment’s scope.”
Shelk said that, “In the decades since McCarran’s adoption, insurers have been able, through state oversight of advisory organizations, to share loss cost data to predict future losses and to develop common policy forms, which has fostered competition in a manner that greatly benefits consumers.”
At the same time, the amendment’s sponsor, Rep. Paul Gosar, R-Ariz., highlighted in a House floor speech a provision of the amendment that would bar class action lawsuits in federal court against health insurance companies.
“The Federal Trade Commission should have the power to investigate bad actors in the health insurance industry, but it helps no one if these companies, or for that matter any American business, gets mired in lawsuits that will cost millions,” Gosar said.
“Class action lawsuits often result in big bucks in attorney’s fees for greedy trial lawyers while leaving only pennies in the hands of the plaintiffs who were allegedly wronged in the first place,” he said. The amendment passed by voice vote.
Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, said after the vote that, “Health insurance is one of the most regulated industries in America at both the federal and the state levels. The McCarran-Ferguson Act is extremely limited in scope and has nothing to do with competition within the health insurance industry.”
He added that, “The focus should be on addressing the underlying cost of medical care, which is the real driver of rising premiums.”
The underlying legislation, H.R. 5, Protecting Access to Healthcare (PATH) Act, imposes federal standards designed to further limit medical malpractice suits. It would do so by capping a medical malpractice victim’s recovery.
The bill passed the House, 223 to 181, in a mostly party-line vote.