By Rep. Diana DeGette (D-Colo.) - 10/29/09
Congress is on the brink of passing legislation that will truly reform the health insurance market. Reform will improve competition and rein in rising costs, while providing millions of uninsured Americans with access to high quality health care. Competition is the crux of the debate - the lack of competition in the market has hurt consumers, and has contributed to rapidly escalating health care costs.
Every year, health care premiums consume a larger portion of Americans household budgets. By tearing down the barriers to competition, for example, by repealing an antitrust exemption and creating a strong public insurance option, Congress can achieve the goals of lower costs and improved health care outcomes.
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
. 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.
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Offered within a health insurance exchange, a public option would compete on a level playing field against private insurance companies in order to reduce costs. It would not come close to replacing private industry; rather it would simply provide Americans with another choice that will likely be more innovative and affordable than the options currently available. A public option is essential to creating the cost-savings necessary to offset the cost of providing all Americans access to affordable health care.
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