The House of Representatives passed the Health Insurance Fair Competition Act today, legislation that promotes greater competition amongst health care insurance companies by making them subject to the same anti-trust laws governing nearly all other industries.  The legislation passed by a vote of 406 to 19.

 “Removing the anti-trust exemption will allow federal enforcement officials to ensure health insurance companies are not using policies, such as price-fixing or collusion, to harm consumers,” said Rep. Levin.  “We should be using all the tools at our disposal to bring down health care costs for Michigan families.”

Since 1945, when the original anti-trust exemption was enacted, it has been the responsibility of states to monitor and bring cases against health insurance companies suspected of using price-fixing, collusion, or other anti-competitive practices.  However, state insurance commissioners have not brought any actions against health insurers for anti-competitive conduct during at least the last five years.  In 2007 the National Association of State Attorneys General overwhelming adopted a resolution calling for repealing the exemption.

Comprehensive health care reform legislation passed by the House in November included a repeal of the anti-trust exemption as well as several other provisions to make the health care market more competitive.  These included the creation of a health insurance exchanges where individuals and small businesses would be able to comparison shop for health care plans, new rules to allow states to partner so that their citizens can shop for health insurance across state lines, and prohibition against pre-existing condition exclusions that will require insurance companies to compete on price and quality rather than on the basis of which one can assemble the healthiest pool of subscribers.