Wider Oversight Looms for Insurers in house health care bill

Discussion in 'Wall St. News' started by tmarket, Nov 8, 2009.

  1. The House health-care bill would repeal an exemption from federal antitrust oversight that the health-insurance industry has enjoyed for decades, but the move alone might not make local insurance markets more competitive.

    The repeal is necessary to inject competition into regional insurance markets, according to Rep. Diana DeGette (D., Colo.), one of several members of Congress behind a push to repeal the exemption. She cited American Medical Association figures showing that 94% of those markets are highly concentrated. She said she wasn't sure whether the antitrust exemption was to blame for the lack of competition, but "the way the market is behaving would send up red flags," she said.

    The 1945 law, the McCarran-Ferguson Act, gave states the power to regulate insurers and freed companies from federal antitrust authority in categories where state laws existed. In other categories, such as mergers and acquisitions, insurers continued to be monitored by the Department of Justice.