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Congressman Pascrell Backs Legislation To Repeal Health Insurance Companies' Exemption From Anti-trust Laws

Press Release

Location: Washington, DC

In an effort to make health insurance companies more accountable to their customers, U.S. Rep. Bill Pascrell, Jr. (D-NJ-8) voted with the House majority in favor of the Health Insurance Industry Fair Competition Act (HR 4626), which passed today with a vote of 406-19.

"In all the industries in all of America, there are only two that have anti-trust exemptions: baseball -- America's pastime -- and the health insurance industry--America's nightmare," said Pascrell, a member of the House Ways and Means Committee who co-sponsored HR 4626.

"If we allow insurance companies to continue to be exempt from the laws nearly every other industry has to abide by, we allow them to continue to kill any new forms of competition we try to infuse into the insurance marketplace," said Pascrell, speaking from the House floor today. "The American people have many different opinions on comprehensive health reform, but are quite clear on their distaste for this exemption."

The legislation would effectively end a nearly 65-year-old federal exemption from civil liability claims granted to health insurance companies in the McCarran-Ferguson Act of 1945.

Since then, the health insurance industry has been legally exempt from anti-trust laws, and the federal government was banned from even investigating evidence of possible collusion.

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.

The legislation is supported by numerous groups including the American Hospital Association, American Nurses Association, American Academy of Pediatrics, Consumers Union, the Consumer Federation of America, Center for Justice and Democracy, and U.S. PIRG.

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