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Congressman Peter DeFazio

Representing the 4th District of OREGON

Reps. DeFazio, Gosar Introduce Bipartisan Legislation to Protect Consumers from Health Care Industry Price-Gouging

Feb 28, 2019
Press Release

Reps. Peter DeFazio (OR-04) and Paul Gosar (AZ-04) today introduced the Competitive Health Insurance Reform Act , H.R. 1418, which repeals the antiquated exemption that allows the health insurance industry to operate beyond the reach of federal antitrust laws. 

“It is preposterous that this anti-free-market exemption is still on the books,” DeFazio said. “This exemption gives insurance companies the power to collude to drive up prices, limit competition, conspire to underpay doctors and hospitals, and price gouge consumers. Congress needs to act in order to rein in skyrocketing healthcare costs. Not only will this legislation protect consumers, it will ensure the health insurance industry is subject to the same rules as virtually every other industry.”

“As a healthcare provider for more than two decades, I understand the importance of a competitive health insurance market,” said Gosar. “Patients, doctors, and hospitals all benefit when health insurers compete to provide a variety of quality coverage options. The healthcare market should be patient-centric, and should provide a variety of affordable and quality options, all fostered by competition. There is no reason in law, policy, or logic for the insurance industry to have special exemptions that are different from all other businesses in the U.S. The government should not be picking winners or losers, and the insurance industry should also have to comply with federal anti-trust laws. I am proud of this legislation, which would restore the application of federal anti-trust and competition laws to the health insurance industry. Imagine the possibilities when we put the patient first and demand that health insurance companies compete for their business.”

The McCarran-Ferguson Act, passed in 1945, exempts the business of insurance from the federal antitrust laws that promote fair competition. The only other industry exempt from antitrust laws is Major League Baseball.

The Health Insurance Industry Fair Competition Act would repeal the exemption and give the Department of Justice and the Federal Trade Commission the authority to apply antitrust laws to anticompetitive behavior by insurance companies. This legislation would not affect the ability of each state to regulate the business of insurance. Similar legislation passed the House of Representatives in 2017 with overwhelming bipartisan support in a vote of 416-7.

Identical legislation was introduced in the Senate by Senators Patrick Leahy (VT) and Steve Daines (MT).

 

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