In a rare appearance as a witness at a Senate hearing, the majority
leader, Harry Reid of Nevada, told the Judiciary Committee on Wednesday
that it should repeal a 1945 law that granted the insurance industry
limited exemption to national antitrust laws by allowing states to
regulate insurers.
The law, the McCarran-Ferguson Act, is often cited by Sen. Reid and
other critics of the health insurance industry as a reason why coverage
can be so expensive for many people. They say the law allows insurers
to monopolize markets and fix prices in ways that are usually illegal.
“Since 1945, the insurance industry has enjoyed exemption from
federal antitrust laws because of the McCarran-Ferguson Act,” said Sen.
Reid. “Pat McCarran, who was the senior senator from Nevada at the
time, lent his name to this piece of legislation. Although we’re both
Nevadans, I’m not sure what Pat McCarran had in mind when he pushed
this bill. And if Pat were around today, he couldn’t be happy with the
state of the insurance industry.”
“Providing an exemption for insurance companies to antitrust laws
has been anticompetitive and damaging to the American economy,” Sen.
Reid continued. “Health insurance premiums have continued to rise at a
rapid rate, forcing businesses to cut back on health insurance coverage
and forcing many families to choose between health insurance and basic
necessities.”
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