The House overwhelmingly passed a bill last night that will repeal the McCarran-Ferguson Act. The bill removes health insurance companies from being exempt to competition laws. It strikes an important political victory in the House for showing a glimmer of bipartisanship right before the Health Care Summit.
Lawmakers hope that dropping the McCarran-Ferguson Act will lower premiums in insurance markets by increasing competition and offering consumers more choices.
Whether repealing this act will actually reduce health insurance costs is highly debatable.
Karen Ignagni, President and CEO of AHIP said, “The rhetoric surrounding repeal of McCarran-Ferguson does not match the reality of the situation. Health insurance is one of the most regulated industries in America at both the federal and the state levels. The Act is extremely limited in scope and has nothing to do with competition within the health insurance industry…the real focus should be on addressing the rising cost of medical care, which is putting an unsustainable burden on families, employers, and the federal budget. ”
The Congressional Budget Office determined that repealing the anti-trust exemption law would not make a significant impact on the federal budget or on health insurance premiums last year.
Time will tell if repealing the law will decrease health insurance costs for consumers and increase competition. However, with the amount that health insurance companies are already regulated, there may not be a significant change.