Congresswoman Maxine Waters Votes to Restore Competition and Fairness in the Health Insurance Marketplace
Congresswoman Maxine Waters (CA-35) voted today to ensure that American consumers get a real choice and a fair deal when purchasing health insurance. The Health Insurance Industry Fair Competition Act, which the House passed by a vote of 406-19, will take away the anti-trust exemption for health insurance companies, requiring them to compete fairly and adhere to the same anti-trust laws as other companies.
"For too long, Americans have been ripped off by health insurance companies that don't play by the rules," said Congresswoman Waters. "Every day people are denied coverage, see their premiums rise, and make tough choices about paying the bills or paying for medicine – all while the insurance companies are jacking up prices and turning record profits. Enough is enough."
In 1945, under the McCarran-Ferguson Act, the health insurance industry became legally exempt from anti-trust laws, and the federal government was banned from even investigating evidence of possible collusion between health insurance companies. In the last 14 years alone, there have been 400 mergers among health insurers and now 94% of all insurance markets are "highly concentrated" – meaning consumers have little or no choice between insurance providers.
"By enjoying an exemption from anti-trust laws that apply to almost all other businesses, health insurers are able to rake in exorbitant profits at the expense of American families," said Congresswoman Waters. "Congress has the responsibility to fix this broken system and end the industry's predatory and anticompetitive practices."
Health insurers that were previously exempt from anti-trust laws will now bear legal responsibility for price fixing, dividing up territories among themselves and sabotaging their competitors in order to gain a monopoly in the marketplace. Such practices have been outlawed in other industries for decades.
"WellPoint's Anthem Blue Cross health insurance company recently announced that it will increase the cost of premiums in California for individual policyholders as much as 39 percent. Insurance rates in other states and for other companies are also going up by double digits. This is further evidence the current health system is not sustainable," said Congresswoman Waters. "Clearly, comprehensive health care reform is urgently needed, and this legislation will be instrumental in achieving two main objectives of any meaningful reform: lowering costs and increasing consumer choice."
The legislation is supported by numerous groups including the American Hospital Association, American Nurses Association, American Academy of Pediatrics, Consumers Union, Consumer Federation of America, Center for Justice and Democracy, and U.S. PIRG.