H.R. 372, the “Competitive Health Insurance Reform Act of 2017,” would partially repeal the limited Federal antitrust exemption for the business of insurance established by the McCarran-Ferguson Act in 1945. H.R. 372 would only permit federal antitrust enforcement with regard to health insurers.
House Democrats have previously supported a full repeal of McCarran-Ferguson’s antitrust exemption for all insurers, not just health insurers. In 2010, House Democrats also passed more limited legislation to repeal McCarran-Ferguson’s antitrust immunity for health insurers by a vote of 406 to 19. House Republicans had not previously expressed any interest in moving any version of this legislation.
While there has been and continues to be bipartisan support for the repeal of McCarran-Ferguson with regard to health insurers, the Majority has made a series of overstated claims regarding H.R. 372 as part of the so-called “third phase” of their health care “reform” efforts. As such, we do not endorse the Majority’s exaggerated claims that passage of H.R. 372 will somehow create major new competition, significantly improve the affordability and availability of health insurance, or encourage health insurers to sell insurance products across state lines. In reality, this legislation:
· Will Not Significantly Improve Healthcare Affordability or Coverage. According to the Congressional Budget Office (CBO), the effect of H.R. 372 on health insurance premiums “would probably be quite small,” and enacting the bill will have “no significant net effect on the premiums that private insurers would charge for health or dental insurance.”Consumers Union states that the application of the antitrust laws to some health insurance activity is simply not enough to create a vibrant insurance market because our “long experience shows you can’t expect a health care system to run effectively on competition alone.”
· Does Not Enable Health Insurers to Sell Insurance Across State Lines. Enabling the Federal antitrust agencies to police certain forms of anticompetitive conduct will not in and of itself incentivize health insurers to offer products across state lines. In fact, current state and Federal law, including the Affordable Care Act, already allows states to agree with each other to provide for cross-state insurance sales.
· Does Not Protect Consumers Against Discrimination or Premium Growth. H.R. 372 only applies to certain anticompetitive conduct and does not change the regulation of health insurance. For example, it does not prohibit discrimination based on preexisting conditions, reduce premium growth, or require health insurers to be accountable for price increases.
· Does Not Provide the Antitrust Agencies with Necessary Resources to Enforce the Law. If the Administration truly wanted to encourage more vigorous antitrust enforcement in the health insurance market, they would fully fund and appoint heads to the antitrust agencies. Instead, the President Trump’s recently issued budget blueprint would reduce DOJ funding overall, to the likely detriment of antitrust enforcement.