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Panel axes health insurer antitrust shield

Oct. 21, 2009 at 3:56 PM

WASHINGTON, Oct. 21 (UPI) -- The U.S. House Judiciary Committee voted Wednesday to repeal federal antitrust exemptions for health insurers, and key senators said they would do the same.

Three Republicans joined 17 Democrats in the 20-9 vote to remove federal protections that shield health insurers from investigations into price fixing and other business practices, The Washington Post reported.

The measure would repeal portions of the 1945 McCarran-Ferguson Act that allows states to regulate health insurance providers without federal intervention. Since its passage, critics say, the law has led to regional monopolies that drive up premiums and discriminate against people based on their health status, gender and other factors, the Post said.

"No one on this committee believes that price fixing or carving up markets is a good thing, and the wide, bipartisan support for this bill's passage reflects this," Judiciary Chairman John Conyers, D-Mich., said. "This measure fixes a mistake sitting on the federal statutes for over 60 years."

Karen Ignagni, president of the industry trade group America's Health Insurance Plans, challenged the necessity for the legislation.

"We believe that health insurers have not been engaging in anti-competitive conduct and that McCarran-Ferguson does not provide a shield for such conduct," Ignagni wrote in a letter to the committee.

In the Senate, meanwhile, Majority Leader Harry Reid of Nevada said he and other key Democrats would announce their plans to strip the health insurance industry of its antitrust exemption, The Hill reported.

"The move mirrors actions taken by House leaders to also include the change in antitrust rules in their version of health reform legislation," Reid said on his Twitter page.

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