10 Insurance Trade Groups Hit Health Bill Wording On FTC Role

NU Online News Service, Nov. 9, 3:51 p.m. EST

WASHINGTON–Ten property and casualty and life-health insurance trade groups have written lawmakers opposing a House health care bill provision to permit the Federal Trade Commission to prepare studies and reports on their industry.

The letter sent Friday to every member of the House of Representatives voiced "strong opposition" to an amendment to H.R. 3962, the Affordable Health Care for America Act, added last week by Rep. John Dingell, D-Mich., chairman-emeritus of the House Energy and Commerce Committee.

The bill was approved Saturday by the House on a 220-215 vote.

Another provision of the legislation would repeal the antitrust protection accorded health and medical malpractice insurers by the McCarran-Ferguson Act.

The letter is similar to the stance taken by the industry in 2007, when Sen. Patrick Leahy, D-Vt., Sen. Arlen Specter, D-Pa., and Sen. Trent Lott, R-Miss., introduced legislation that would repeal the McCarran-Ferguson Act.

In 2007 they introduced the bill in reaction to complaints by consumers and businesses in Louisiana and Mississippi that insurance companies were not paying claims for damages incurred by Hurricanes Katrina and Rita.

The organizations' letter said rather than the antitrust issue, "as the bill's title implies, its goal should be to address issues of health care coverage and affordability."

"This purpose is not served by allowing the FTC to investigate all lines of insurance (which is the job of state insurance regulators)," the letter said.

"It is also not served by limiting the protections the McCarran-Ferguson Act provides for pro-competitive insurance activities that are subject to scrutiny by state insurance regulators, especially those that facilitate greater market access by medical malpractice insurers," the letter added.

The amendment by Rep. Dingell provides for an even more sweeping expansion of FTC authority by deleting the term "the business of"–leaving only the term "insurance," the letter said.

"This amendment would not even limit the FTC's authority to activities that have been found by the courts to be a part of the "business of insurance," but would instead vest the FTC with unfettered discretion to conduct investigations of virtually anything that falls within the term 'insurance' in any line," the letter said.