Democrats leading pro-competition anti-trust health reform

Figuring prominently in the new health care bill released by House Democrats yesterday is a provision to repeal the anti-trust exemption that the health insurance industry currently enjoys.

It’s arguably an odd twist in the traditional Republican-Democratic battle, in that Democrats are the ones pushing hard to return to the free market.

For example, this morning, U.S. Rep. Diana DeGette, representing Colorado’s First District, released an opinion piece in support of the repeal to several news outlets, including the Colorado Independent. DeGette—co-sponsor of an earlier bill written to repeal the insurance industry’s anti-trust exemptions—explained why she thought such a repeal was crucial to health care reform:

As premiums continue to skyrocket, we must ensure that health insurers are not engaging in anticompetitive behavior and unfairly driving up health care costs. Since 1945, the health insurance industry has enjoyed an exemption from federal antitrust law. This exemption prevents the application of federal antitrust laws to the business of insurance, provided that the activity is regulated by state law and is not designed to boycott, coerce, or intimidate.  Despite the fact that the health insurance industry is highly concentrated, the federal government is handcuffed in its ability to identify or respond to any potential violations. The American Medical Association estimates that 94 percent of the top insurance markets are anticompetitive. In Pueblo, Colorado, for instance, one insurance company controls over 75 percent of the market. Yet the Department of Justice currently does not have the authority to investigate the industry to determine if anticompetitive violations are occurring.

To protect consumers from such unfair practices, House Judiciary Chairman John Conyers (D-MI) and I introduced The Health Insurance Industry Antitrust Enforcement Act. This measure would repeal the insurance industry’s immunity in instances of price fixing, bid rigging, and market allocation by health or medical malpractice insurance issuers. These potentially egregious violations should not be permitted to occur in any industry, and the federal government should be given the power to protect the public from harmful behavior that drives up prices. President Obama recently voiced support for our efforts, criticizing health insurance companies for “earning [large] profits and bonuses while enjoying a privileged exemption from our antitrust laws, a matter that Congress is rightfully reviewing.” In conjunction with House leadership, we expect to fold our provision into the broader health care proposal currently moving through the House.

Meanwhile, over at the Republican Action Network forum, those logging in have been wondering this month why the Republicans didn’t think of a repeal of companies’ anti-trust exemptions first. From user Rock Slabfist:

I saw recently that Harry Reid was talking about repealing the anti-trust exemption for insurance companies.

Why isn’t our party leading this effort? Are we for competition and the free market or aren’t we?

This could be a real way for us to fight the democrat efforts to create a Europe-like health care system.

We should stand for our principles and end this exemption for insurance companies to encourage the free market and drive down costs!

Do we believe in deregulation or don’t we? Making insurance companies compete is good for America.

So how do Colorado’s Republicans feel about repealing anti-trust exemptions (a repeal that, incidentally, insurance companies have criticized as unnecessary?) In a statement yesterday to the Colorado Independent, Republican U.S. Rep. Michael Coffman of the 6th Congressional District expressed his clear support for anti-trust regulation, even when he wasn’t asked about the issue.

“I also support doing away with the current anti-trust exemption insurance companies receive,” said Coffman, “to increase the number of coverage options available, so people can choose the plan that fits them best.”

As for 5th District Republican Doug Lamborn, he, too, expressed support for a stronger free market:  I support coverage that is truly owned by the patient, which will allow greater choice and portability,” said Lamborn.

“ If we expand the individual market, we can create pooling mechanism such as association health plans and individual membership accounts and give individuals the freedom to shop for health insurance across state lines.  This will help deliver greater choice and affordability to families.”

Asked specifically whether he supported removing insurance companies’ anti-trust exemptions in order to increase competition, Rep. Lamborn’s spokeswoman, Catherine Mortenson, released this statement:

“Congressman Lamborn is studying the issue.”

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