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Democrats Go After Anti-Trust Exemption for Insurers

Wednesday 21 October 2009

by: David Espo  |  The Associated Press

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Congressional Democrats took aim at health insurance companies today by voting on plans to remove their anti-trust exemptions. (Photo: quinnums / flickr)

    Washington - Democrats launched a drive at both ends of the Capitol on Wednesday to strip the insurance industry of its decades-old exemption from federal antitrust laws, part of an increasingly bare-knuckled struggle over landmark health care legislation sought by President Barack Obama.

    If enacted, the change would put an end to "price-fixing, bid-rigging and market allocation in the health and medical malpractice" insurance areas, said Sen. Patrick Leahy, D-Vt., chairman of the Senate Judiciary Committee. Leahy said he would seek a vote on the plan when the Senate debates health care legislation in the next few weeks.

    Leahy made his comments at the same time the House Judiciary Committee voted 20-9 to end an industry exemption that dates to 1945. Three Republicans supported the move.

    To read more on the Democrats call for stripping the anti-trust exemption for health insurors, click here.

  

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Comments

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Yes, let's try a

Wed, 10/21/2009 - 21:38 β€” Anonymous (not verified)
Yes, let's try a whimpering, toothless "Standard Oil" approach to our health care crises, as front money pours into DC from companies that control the process.

The insurance companies rely

 Wed, 10/21/2009 - 22:20 β€” Blogger Actuary (not verified)
The insurance companies rely on the law of large numbers when they calculate premiums. Accuracy of their premium estimates is improved by pooling exposures with other insurance companies in order to pinpoint estimates of future claims costs. If insurers are unable to pool exposures, they will be unable to accurately apply the law of large numbers to forecast their claims costs. This places a burden on the company actuaries who will have to place ever larger uncertainty loadings on their premium estimates. When will the math-blind lawyers who run our congress realize that repealing the antitrust exemption will lead to very large premium increases and an inability among small insurance companies to compete? Probably never.

The emperor has no clothes!

Wed, 10/21/2009 - 23:25 β€” Don (not verified)
The emperor has no clothes! Finally! I was appalled to learn that health insurance companies are exempt from anti-trust laws. Health costs have outpaced inflation by 500% over the last decades. With "economist" shills justifying it due to advances in technology, new drug costs, etc. How stupid have we been (or how corrupt the system)? The exemption should be lifted NOW -- maybe that will keep the insurance companies from jacking up their rates before the reforms kick in. Otherwise --- look out!!

Good. Let the market be

 Thu, 10/22/2009 - 06:04 β€” borisjimbo (not verified)
Good. Let the market be free; open up the doors of competition, let's see how the big boys do against the young upstarts like a perfect capitalist economy is supposed to do.

You call what we have now

 Thu, 10/22/2009 - 06:08 β€” borisjimbo (not verified)
You call what we have now competition? Many markets have 70% concentration in one company. If the insurance companies want to make more money, they can quit hiring so bloody many lobbyists.

"Blogger Actuary" is

 Thu, 10/22/2009 - 19:15 β€” Don (not verified)
"Blogger Actuary" is completely off base. There is -- and should be -- really only ONE pool that is relevant for 99% of health care consumers --- EVERYONE. Dividing the population into thousands of pools only makes it possible for insurance companies to charge huge premiums. It makes no sense that the same person in a large company has cheaper insurance than he does two minutes later when he's laid off. And Medicare takes the most vulnerable population out of the general pool anyway (which the insurance companies love). It's time to stop the GOLDEN EGG and free ride for the insurance companies.

We can generally count on

 Thu, 10/22/2009 - 20:14 β€” Anonymous (not verified)
We can generally count on unintended consequences of any legislation dealing with a specific industry. If Blogger Actuary is correct, that insurance companies currently pool exposures, then the legislation should be crafted to permit that while making illegal market concentration in geographical areas, and other ills. One idea might be that insurance premiums paid for health "care" cannot be used for lobbying or for executive salaries and bonuses greater than 25 times the lowest paid employee of a given corporation.

WTF is Blogger Actuary

 Thu, 10/22/2009 - 20:59 β€” Anonymous (not verified)
WTF is Blogger Actuary trying to explain? What has anti-trust got to do with actuary base? The factual evidence tells us the bottom line: Private insurance companies are raping us blind. Typical gobbily gook by greedy professionals.

BloggerActuary 22:20=might

 Thu, 10/22/2009 - 23:51 β€” Anonarcmous (not verified)
BloggerActuary 22:20=might be right--as other succesful industrialized countries providing better healthcare than the USA--we are #33--is 1-PAYER-HEALTHCARE, maybe even Medicare!!!!One source of funds, but no monopoly on care providers. Because the proof in the pudding of the $25B profits last year!!!

borisjimbo, I completely

 Fri, 10/23/2009 - 01:27 β€” Hikerdudette (not verified)
borisjimbo, I completely agree!!

Leahy for President!

 Fri, 10/23/2009 - 01:28 β€” Mayme (not verified)
Leahy for President!

Well, at least Leahy seems

 Fri, 10/23/2009 - 17:11 β€” Anonymous (not verified)
Well, at least Leahy seems less Corporate owned and operated than the rest of the bunch in the US Congress of Corporate Facilitation...

The existing insurance

 Mon, 11/02/2009 - 22:07 β€” Blogger Actuary (not verified)
The existing insurance anti-trust exemption is narrow: it does not allow insurance companies to collude and price fix. Its scope is the collection of data as a basis for scientific rate making. If this exemption is closed off, expect companies to be forced to operate "in the dark". Operation under these circumstances will lead to more expensive premiums and diminished competition. Wake up, people!