Defazio Bipartisan Bill to Curb Health Insurance Price-Gouging Unanimously Passes House

Press Release

The Competitive Health Insurance Reform Act, bipartisan legislation introduced by Rep. Peter DeFazio (OR-04) to rein in health insurance price-gouging, today passed the House of Representatives.

The bill, H.R. 1418, would repeal an antiquated exemption that allows insurance companies to operate beyond the reach of federal antitrust laws and coordinate to set health care costs and market share to increase profits and gouge consumers.

"Even before the COVID-19 pandemic, nearly 1 in 4 Americans--including insured Americans--were already skipping medical care and prescription drug doses because of high costs. Today, while accessible, affordable medical care is more important than ever, insurance companies still have free rein to price-gouge consumers and reap massive profits on the backs of seniors, working families, and everyday Americans. That's obscene," said DeFazio. "As long as this exemption is still on the books, health insurance companies legally can, and do, collude to drive up prices, limit competition, conspire to underpay doctors and hospitals, and overcharge consumers. My legislation will protect consumers and make sure the health insurance industry plays by the same rules as virtually every other industry in America."

The McCarran-Ferguson Act, passed in 1945, exempts the business of insurance from the federal antitrust laws that protect and promote fair competition.

The Competitive Health Insurance Reform Act would repeal this antiquated exemption and give the Department of Justice and the Federal Trade Commission the authority to apply federal antitrust laws to anticompetitive behavior by health insurance companies. This would help rein in skyrocketing health care costs and ensure consumer protections are in place to guard against the health insurance industry's abuses and greed. This Act would not affect the ability of each state to regulate the business of insurance.

In the midst of the COVID-19 pandemic and subsequent economic downturn, several major U.S. health insurers have reported increased profits, totaling billions of dollars. This comes at the same time as the number of uninsured Americans continues to rise. Between February and May alone, an estimated 5.4 million Americans lost their health insurance coverage.

H.R. 1418 is supported by the following organizations: Consumer Reports, Consumer Federation of America, Consumer Action, American Dental Association, American Hospital Association, American Student Dental Association, Academy of General Dentistry, American Association of Women Dentists, American Academy of Pediatric Dentistry, American Academy of Oral & Maxillofacial Pathology, American Association of Oral and Maxillofacial Surgeons, American Optometric Association, American College of Surgeons, American Association of Endodontists, American Academy of Periodontology, American Academy of Neurology, American Association of Orthopaedic Surgeons, National Community Pharmacists Association, American Dental Education Association, American Association of Orthodontists, American Association of Neurological Surgeons, Congress of Neurological Surgeons, and the American College of Emergency Physicians.

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