AntiTrust on House Radar

March 20, 2012 at 06:11 AM
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A House panel will decide today whether to clear for floor action later this week a vote on three amendments to the healthcare legislation that would remove the McCarran-Ferguson Act antitrust exemption for health and medical malpractice insurance.

A concerned industry has scheduled a conference call to discuss the proposed amendments, the second industry-wide meeting dealing with the issue within a week.

Industry officials were not available to comment last night.

The House Rules Committee will consider the three amendments at a meeting scheduled for 3 p.m. A total of 20 amendments have been proposed.

The Rules panel is the gatekeeper for House floor action, setting the rules for debate on House floor action as well as which amendments to clear the floor for.

The legislation in question is H.R. 5, the "Help Efficient, Accessible, Low-Cost, Timely Healthcare (HEALTH) Act of 2011."

House floor debate is scheduled for Thursday.

The purpose of the measure is to repeal a provision of the healthcare reform law that creates the Independent Payment Advisory Board, a 15-member board whose role is to find ways to reduce growth in Medicare spending.

According to analysts at Washington Analysis, "at one point, there were almost 20 Democratic co-sponsors."

But efforts to pay for the bill by imposing new limits on medical malpractice lawsuits have "eroded much of that support," the analysts said.

In any case, the analysts said, "the opposition of Senate Democrats and President Obama ensures that it would not be signed into law regardless of the level of support in the House."

But efforts to add amendments ending the anti-trust exemption accorded to health insurance providers under the McCarran-Ferguson Act have raised concerns within the insurance industry.

The industry was anticipating that Rep. Paul Gosar, R-Ariz., would introduce an amendment repealing the McCarran-Ferguson Act but were unclear whether he would do so both for medical liability insurance, as well as for health insurance. 

Gosar did introduce his amendment Monday, but it covered only the "business of health insurance."

However, Rep. John Conyers, D-Mich., Maxine Waters, D-Calif., and Peter DeFazio, D-Ore., also introduced amendments dealing with McCarran-Ferguson.

A Conyers-Waters amendment, No. 20, would end the antitrust exemption for medical malpractice insurance, as well as provide the Federal Trade Commission authority to extend its powers to prevent "unfair methods of competition."

The DeFazio amendment applies only to health insurance. But, it would extend the power of the federal government to address "unfair methods of competition," and extend it to include non-profit providers.

The industry is concerned because it fears such an amendment would be the nose under the camel's tent.

For example, a flyer the industry intends to circulate to House members cites a Congressional Research Office paper in a January 2010 report that says, "Passage of any of the measures (the more limited versions impacting health and medical malpractice insurance) is likely to precipitate litigation to define the scope of the prohibition and/or any remaining exemption."

The flyer contends that, "Repeal of the McCarran-Ferguson is Anti-Competitive."

The flyer states that McCarran -Ferguson allows insurers, through state oversight of advisory organizations, to share loss cost data to predict future losses and to develop common policy forms. The Department of Justice has previously determined these activities are permissible because advisory organizations are regulated by state law.

"It is these activities that particularly allow smaller insurers and new market entrants to properly price their products to cover expected losses and for consumers to be able to easily compare insurance products," the flyer said.

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