• Senator Leahy Again Calls For the Repeal of the Insurance Industry’s McCarran-Ferguson Act Antitrust Exemption
  • November 3, 2010 | Author: James M. Burns
  • Law Firm: Williams Mullen - Washington Office
  • Following the Department of Justice’s October 18 announcement of the filing of an antitrust action against Blue Cross Blue Shield of Michigan, Senator Patrick Leahy (D., Vt.) promptly called for the repeal of the insurance industry’s antitrust exemption. Senator Leahy has long been a strong proponent of the repeal of the McCarran-Ferguson Act, and is the sponsor of McCarran repeal legislation (Senate Bill 1681) that is currently pending in the Senate. (McCarran repeal legislation was passed in the House -- as H.R. 4626 -- earlier this year by a vote of 406-19.)

    In a press release issued immediately after the announcement of the DOJ action, Senator Leahy stated: “I applaud the Department of Justice for employing our nation’s antitrust laws to break up the stranglehold that massive insurance companies have on our healthcare industry. Given that much of the health insurance industry activity is shielded from the antitrust laws by an antiquated exemption, it is perhaps not surprising that insurers are also engaging in anticompetitive conduct that falls outside the exemption.” He continued: “Only when Congress passes the Health Insurance Industry Antitrust Enforcement Act, which I introduced last year, will we know the full scope of how the industry’s anticompetitive conduct is harming consumers and driving up health care costs. The House passed this bill by an overwhelming, bipartisan 406-19 vote. The Senate should do the same when it returns in November.”

    Only hours later, Representative John Conyers (D. Mich.), another strong supporter of the repeal of McCarran, issued a similar statement. He stated that he was “pleased” by the filing of the suit, and that the House Subcommittee on Courts and Competition Policy, which he chairs, “intends to closely follow the developments in Michigan as they unfold.” Representative Conyers continued: “While the lawsuit is a helpful step forward, in the long run, the insurance industry needs to be fully subject to the antitrust laws,” and “That is why I have long supported repealing the McCarran-Ferguson Act.”

    Congress returns from recess after the November elections for an abbreviated session that is expected to focus on budget issues and federal tax policy. Whether Senator Leahy’s request that McCarran repeal be added to the agenda will be accommodated remains to be seen. If not, the McCarran-Ferguson Act will - somewhat unexpectedly - have survived the 111th Congress.