WASHINGTON (CN) – The House Judiciary Committee voted 20-9 on Wednesday to limit the antitrust exemption for health insurance companies.
“Today’s vote is an important step forward toward opening up health and medical malpractice insurance markets to real competition,” said Democratic Chairman John Conyers of Michigan.
Seventeen Democrats and three Republicans voted in favor.
But while many are applauding the bill as bipartisan, Ranking Member Lamar Smith voiced his concern.
“It’s doubtful that this legislation will do anything beneficial for the customer,” he said.
The legislation would do away with the exemption health insurance companies have enjoyed from federal antitrust laws.
Health and medical malpractice insurers have been exempted from federal antitrust laws since 1945, when the McCarran-Ferguson Act – which subjected the companies to only state antitrust laws – was passed.
“Although state regulation of this industry is crucial, and is preserved in this bill, it has proved insufficient to prevent these particularly abusive practices.”
“Although state regulation of this industry is crucial, and is preserved in this bill, it has proved insufficient to prevent these particularly abusive practices,” Conyers said.
“The House Judiciary Committee agreed to bring antitrust enforcement to the two most abusive practices of the health insurance industry, price fixing and market allocation,” Conyers added.
He called the bill an important contribution to the health care reform currently being hammered out by Congress.
But Smith, the ranking member, seemed to disagree. “When repealing an existing antitrust exemption, we must be very careful of the unintended consequences of our actions,” he said in a released statement. “For more than 60 years, the states have regulated the business of insurance. By inviting federal intervention, this bill might create a dual regulatory system that only confuses the health insurance and medical malpractice industry.”
The bill will now be taken up on the House floor and a matching bill is awaiting consideration by the Senate Judiciary Committee.