NU Online News Service
WASHINGTON–Legislation to repeal the antitrust exemption for health and medical malpractice insurers has been modified to include scrutiny of those insurers practices, an insurance trade group said.
Moreover, the new language contained in a broad health care reform measure would give express enforcement authority to the Federal Trade Commission with respect to "unfair methods of competition," by insurers according to officials of the American Insurance Association.
"The new language is even more objectionable, if that is even possible," said Blain Rethmeier, an AIA spokesman.
The new provision is contained in a manager's amendment to H.R. 3962, the "Affordable Health Care for America Act bill. It was added by Rep. John Dingell, D-Mich., chairman-emeritus of the House Energy & Commerce Committee.
According to Mr. Rethmeier, unlike prior versions of the language repealing the McCarran-Ferguson Act antitrust exemption, this version does not introduce new, undefined statutory terms such as "price-fixing" or "market allocation" that the organization objected to.
Instead, the provision allows federal anti-trust laws to broadly apply to the "business of health insurance or the business of medical malpractice insurance" without the benefit of the McCarran-Ferguson anti-trust exemption.
So, he explained, "while the new language eliminated one issue caused by the use of new statutory terms, it replaced it with more sweeping language for these two lines of insurance."
It also fails, he said, to provide any express state regulatory exception, other than, presumably, the availability of the Parker v. Brown doctrine permitting state action, he said, and potentially, the language could expand the scope of the repeal beyond those "engaged" in the business of health or medical malpractice insurance.
Moreover, he said, the "very narrow" set of safe harbors contained in the new language "appear to offer little protection" to underwriters of these two lines of insurance.
Specifically, the new language repealing the McCarran-Ferguson Act exemption from antitrust laws for health and medical malpractice insurers says that, "nothing contained in this Act shall modify, impair, or supersede the operation of any of the antitrust laws with respect to the business of health insurance or the business of medical malpractice insurance."
The safe harbors would provide an exemption for "collecting, compiling, classifying, or disseminating historical loss data; determining a loss development factor applicable to historical loss data; or performing actuarial services if doing so does not involve a restraint of trade."
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