Lawmakers press Justice Dept. on antitrust reform

Aug. 30 deadline requested for update

Washington - A bipartisan group of lawmakers is asking the U.S. Department of Justice for an update on efforts to combat anticompetitive conduct in the health insurance industry following last year's repeal of the McCarran-Ferguson antitrust exemption.

The Competitive Health Insurance Reform Act became law in January 2021 and is aimed at improving transparency. The law was the culmination of a multi-year effort by the ADA and dentists to persuade Congress that health care insurance, including dental plans, should no longer be protected from some of the federal antitrust laws.

In a July 26 letter to the Department of Justice's Antitrust Division, Rep. Peter DeFazio, D-Ore., who co-sponsored the bill, and Reps. Drew Ferguson, R-Ga., Jerrold Nadler, D-N.Y., Ken Buck, R-Colo., and David Cicilline, D-R.I., urged the division to help Congress understand how it is enforcing the antitrust laws following the enactment of the law.

"[T]his law amending the McCarran-Ferguson Act was a monumental and positive step for competition and consumer protection. And the amendment was much needed: In the decades following the 1945 enactment of the McCarran-Ferguson Act, health-insurance brokers became increasingly consolidated, leaving the industry ripe for abuse," they wrote. "With limited exceptions, the McCarran-Ferguson Act gave health-insurance companies free rein to exert market power and collude to drive up premiums, price gouge consumers, restrict competition, and deny consumers choice."

The legislators gave the division until Aug. 30 to answer several questions, including:

  • "Since January 13, 2021, what actions, if any, has the [division] taken to enforce the
    antitrust laws against companies in the business of health insurance that are no longer exempt from enforcement under the McCarran-Ferguson Act?"
  • "Aside from the case highlighted in this letter, has the [division] submitted
    any amicus briefs, notices of supplemental authority, business advisory opinions, or other filings regarding the legal consequences of the Competitive Health Insurance Reform Act in any private litigation?"
  • "Given the expanded authorities following [Competitive Health Insurance Reform Act's] enactment, what steps has the [division] taken to review existing health care guidelines to determine whether refinements or new guidelines are needed?"

"[W]e must ensure the Department of Justice and the Federal Trade Commission use their expanded authorities to crack down on any anticompetitive practices in this wealthy industry," Rep. DeFazio said in a news release. "Even before the COVID-19 pandemic, nearly 1 in 4 Americans - including insured Americans - were skipping medical care and prescription drug doses because of high costs. Today, while affordable medical care is more important than ever, health insurance companies continue to price-gouge consumers and reap massive profits on the backs of seniors, working families and everyday Americans. The Department must keep the industry in check, and [the Competitive Health Insurance Reform Act] is a vital tool to do so."

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