Perlmutter Votes to End Antitrust Exemptions for Insurance Companies

February 24, 2010

Today, U.S. Rep. Ed Perlmutter (CO-07) voted with a majority of his House colleagues to pass HR 4626, the Health Insurance Industry Fairness Competition Act, which opens up competition in the health insurance industry by requiring them to compete fairly and adhere to the same anti-trust laws as other companies.

“By passing this bill, we’ve opened the door for lower cost health insurance for millions of Americans,” said Perlmutter.  “Simply put, because insurance companies will be able to compete, consumers will win.”

For 65 years, the health insurance industry was legally exempt from anti-trust laws, and the federal government was banned from investigating evidence of possible collusion. In the last 14 years alone, there have been 400 mergers among health insurers and now 94% of all insurance markets are “highly concentrated” – meaning consumers have little or no choice between insurance providers.

Perlmutter stated, “Coloradans deserve a fair deal when shopping around for something as important as health insurance. Competition is the core principle of our economy, and this bill guarantees consumers more choices and lower costs in the health insurance market, which in turn will spur economic growth now and into the future.”

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.