Tuesday, November 24, 2009

Insurance Industry Antitrust Fight Headed To Conference Committee

Insurance Industry Antitrust Fight Headed To Conference Committee
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Senate Majority Leader Harry Reid (D-Nev.)responded by saying the industry should lose its cherished antitrust exemption -- implemented some 60 years ago by the McCarran-Ferguson Act -- and be forced to compete under the same rules as any other enterprise.

"Insurance companies have become so large they dominate entire regions of the country," he said. "They have become so powerful they block start-up businesses from entering the market, and they put smaller companies out of business. They have become so dominant that they dictate business practices. They are so influential that they exert tremendous influence over public policy."

House Speaker Nancy Pelosi (D-Calif.) seconded Reid the next day, twisting the knife and adding that "it is well known to the public that the health insurance companies are the problem." The following day Judiciary Committee Chairman John Conyers announced a hearing and a committee vote on revoking the exemption. It passed and was included in the House health care bill that passed two weeks ago.

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Nelson argues that repealing the exemption wouldn't hurt the big insurers because they're already so big they don't need to collude with each other. Repealing it, he argues, would only hurt the little guys.

But there are very few little guys left: one or two big insurers are dominant in almost every region of the country.

Nelson, now that he has voted to move the bill forward, is still threatening to filibuster a final bill if he finds it objectionable. Nelson and others want the public health insurance option stripped from the Senate bill, but if it goes to conference too friendly to the industry, the antitrust repeal is likely to be in the bill that comes back. For the industry, it's pick your poison.

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