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| Chuck Schumer blames Insurer Exemption for insane health care cost increases |
| 2009-10-15 |
| The long-simmering tension between insurers and congressional Democrats is erupting into open warfare, with lawmakers stepping up their push to revoke a key federal protection for the insurance industry. Sen. Chuck Schumer (D-N.Y.) on Wednesday called for an amendment to the health care reform bill that would remove the long-standing antitrust exemption for insurers, echoing a push by other Democrats to crack down on the industry. "The health insurance's antitrust exemption is one of the worst accidents of American history," Schumer said. "It deserves a lot of the blame for the huge rise in premiums that has made health insurance so unaffordable. It is time to end this special status and bring true competition to the health insurance industry." As far as I am concerned, the healtcare debate is over with this quote. Kill this law and be done with it. Unless you have ulterior motives, that is. Another good companion piece of legislation would be to limit get-rich-quick medical malpractice suits to actual damages sustained plus attorneys' fees plus a reasonable amount for pain and suffering. No punitive damages except for maybe repeat offenders, which should go to a basket of non-governmental charities. Sen. Patrick Leahy, chairman of the Judiciary Committee, introduced a bill last month to remove the anti-trust exemption and convened a hearing Wednesday, where Schumer called for eliminating the exemption as part of the health bill working its way through Congress. Schumer's push comes on the heels of a controversial industry-sponsored report released over the weekend that makes the case that insurance premiums will go up by as much as $4,000 per family by 2019 if the Senate Finance Committee legislation is signed into law. The release of that report by the industry group America's Health Insurance Plans sparked angry blowback from Democrats in both chambers. Top Democrats in the House also floated the idea during a meeting among party leaders Tuesday evening in Speaker Nancy Pelosi's Capitol suite, someone present said afterward. Senate Majority Leader Harry Reid (D-Nev.) added his support to repealing the exemption at the Leahy hearing. "It's something that should have been done a long time ago," Reid said. As for insurance companies, "There isn't anything we could do to satisfy them in this health care bill. Nothing," Reid said. "They are so anti-competitive. Why? Because they make more money than any other business in America today. . . .What a sweet deal they have." The exemption, known as McCarran-Ferguson, cedes regulatory control of the industry, on the business side, to individual states. But repealing the antitrust exemption would give the federal government more authority to oversee the business side of health insurance companies — something states now have the sole authority to monitor. And the push by Reid and Schumer signals that Democrats are planning to intensify their efforts to paint insurance companies as the villains in the health reform fight, something that could prove useful as President Barack Obama and others try to rally a skeptical public around a sweeping health reform measaure. But the idea has been raised before, and Leahy said Wednesday he scheduled the hearing before AHIP released its report. "I guess the insurance industry is stirring the pot," Schumer said, in response to suggestions from the industry that Leahy called the hearing in retaliation. "Maybe because the insurance industry blundered so badly on Monday, it gives us greater chance to pass it." Health insurance officials dismissed the effort as a "political ploy." "Health insurance is one of the most regulated industries in America at both the federal and state level," said Robert Zirkelbach, a spokesman for America's Health Insurance Plans. "McCarran-Ferguson has nothing to do with competition in the health insurance market. The focus on this issue is a political ploy designed to distract attention away from the real issue of rising health care costs." Still, the push is likely to gather momentum as Democrats try to find a way to lash back at the insurance industry — whose report was viewed as a last-minute attempt to scuttle health care reform just days before Tuesday's critical Senate Finance Committee vote. The legislation there was approved 14-9, with Republican Sen. Olympia Snowe of Maine voting yes and giving reform efforts a boost. Leahy's bill would repeal the exemption established in the 1945 McCarran-Ferguson Act for any companies engaged in price fixing or bid rigging - which are both already illegal. He has introduced similar legislation in other Congresses, including a broader repeal of the underlying law. Reid is a co-sponsor of the current bill. In the House, where Democratic leaders are exploring the issue further, Judiciary Committee Chairman John Conyers (D-Mich.) has introduced legislation that would essentially end McCarran-Ferguson and give the federal government the right to regulate insurers at the national level. |
| Posted by:gorb |
| #11 Sounds like Schumer is trying to make the donk's plan palatable--just window dressing. This is particularly true if what DepotGuy said concerning a 3-4% industry profit margin is indeed correct. If Schumer says anything I'm suspect about it--I just don't trust the guy. He doesn't like the 2nd Amendment. How many of the other Amendments does he not like or support? |
| Posted by: JohnQC 2009-10-15 15:52 |
| #10 I like Steve's idea. Schumer, Rope, Tree. |
| Posted by: Hellfish 2009-10-15 14:03 |
| #9 Dr. White, I'd avoid bankruptcy courts as an example. My experience is that they are among the most corrupt courts; a close community of attorneys whose only alternative is immigration law and politically connected trustees who pick the carcass clean for their own benefit before stiffing the creditors. Perhaps I feel this way because the judge we dealt with was bonking the judge next door in chambers instead of dealing with economic issues he dodged until retirement when he found the trustees had exhausted their percentage. |
| Posted by: Nimble Spemble 2009-10-15 11:07 |
| #8 Medical torts should be heard by a separate court system. Before you recoil from that, consider that we already have special courts for different purposes. For example, we have bankruptcy courts. The judges there have special skills in finance and bankruptcy law. We have admiralty courts. We have intelligence courts. Medical malpractice courts would not have juries, but they would have judges who are tried in the special law and procedures. They could pick experts (in addition to experts provided by plantiff and defense) and get themselves educated on matters of medicine. Do that and you won't need to worry about caps on damages, etc. The problem will largely solve itself. I point out that the bankruptcy courts by and large work -- the judges are fair, companies and individuals get through the system, and while bankruptcy lawyers make a good living, they generally don't circle for the big kill (John Edwards would never have made it as a bankruptcy lawyer). Medical issues, like bankruptcy issues, can be highly technical. We shouldn't burden ordinary citizens with being on the juries of such cases. Put medical torts into a special court system. |
| Posted by: Steve White 2009-10-15 10:41 |
| #7 Reid said. "They are so anti-competitive. Why? Because they make more money than any other business in America today. . . .What a sweet deal they have." Hogwash! The Health Insurance Industry has an average profit margin of 3-4%. The McCarran-Ferguson exemption hasn’t been lifted because individual states insist on unique minimum mandates for insurance coverage. For instance some states mandate minimum coverage include cosmetic procedures where others do not. It’s those states that have fought tooth and nail to keep this exemption – not the insurance industry. It’s a way to manipulate private insurance companies to match their state sponsored insurance plans. And you guessed it…Union plans. In other words, if folks in New York were allowed to purchase less expensive insurance across state lines from say Alabama their stranglehold would collapse. But now they’re suggesting the Feds set those minimum requirements. If liberals at the Federal level mandate the baseline for private insurance companies nationwide you can bet your bottom dollar it will match the states that require the most generous packages. Which, of course, will also be the most costly. So this isn’t an attempt to lower premium costs through anti-trust. It’s a back door into driving private industry out of business. |
| Posted by: DepotGuy 2009-10-15 10:16 |
| #6 NO PUNITIVE DAMAGES - for any civil tort. Punishment, IMHO, should be determined before the fact by laws passed by elected representatives and not ex post facto by a jury. Monetary punishment should be paid to the relevant governmental treasury & not to an individual and his attorney. Punitive damages are just a custom of the country that benefits a very few. Damages done to individuals & pain & suffering, are a different matter. Of course, this is a non-starter for a party in the pocket of trial lawyers. |
| Posted by: Anguper Hupomosing9418 2009-10-15 10:15 |
| #5 Only one thing will minimize the problems we have with health care costs and insurance. Eliminate the tax deductibility of employer paid health insurance and make payment the responsibility of the individual receiving the treatment. We need to get the fourth and fifth parties of the government and the employer out of the picture. Let people get their own insurance, let them pay their own bills, let them get reimbursement from the insurance company. Or let the market evolve new mechanisms. But this idea that employers or the government are adding any value to the process is ridiculous. The only problem is transition. We don't have a problem with plastic surgery and we don't have a problem with automobile insurance. |
| Posted by: Nimble Spemble 2009-10-15 10:13 |
| #4 Perhaps I haven't thought it through entirely, but I have to say that I think Schumer's suggestion here is a a good one (did I really just say that?). I realize the timing of his suggestion makes it look like payback for the insurance companies coming out with the PWC report. However the reality is that the antitrust exemption that insurance companies have enjoyed since the passage of the McCarran-Ferguson Act has allowed the industry to operate as an oligarchy in many ways, which stifles competition and leads to higher costs. I believe that repealing the antitrust exemption is one of the steps necessary to reform the healthcare industry and control costs without adopting the dreaded public option. There are 3 initial steps that I would take, and not at the same time but sequentially. Do them one at a time and see what effect they have before moving on to the next one. So here are the steps and the order I would take them: 1. Make insurance plans and coverage portable across state lines. 2. Medical malpractice tort reform 3. Repeal the McCarran-Ferguson Act and remove the antitrust exemption for insurance cos. These 3 steps could go a long way to providing a free-market, private sector solution to the healthcare cost problem without the government getting their grubby hands into the mix, which would be a disaster as everyone knows. |
| Posted by: eltoroverde 2009-10-15 09:48 |
| #3 ..a reasonable amount for pain and suffering We've already set the value of a life. Simply cap it to the amount America pays to the family of our sons and daughters who give their last full measure of devotion in our defense. |
| Posted by: Procopius2k 2009-10-15 08:31 |
| #2 a push by other Democrats to crack down on the industry Translation, to ease the way for Obamacare by blackening insurers. If you can't make your idea look good, make the opposition's idea look lie shit in the press. |
| Posted by: Redneck Jim 2009-10-15 05:35 |
| #1 "The health insurance's antitrust exemption is one of the worst accidents of American history," Schumer said. "It deserves a lot of the blame for the huge rise in premiums that has made health insurance so unaffordable. It is time to end this special status and bring true competition to the alth insurance industry." Shumer should first remove the federal government from the health care industry, which is an even bigger trust than what they granted the health insurance industry. That act alone would cause prices to plummet immediately. |
| Posted by: badanov 2009-10-15 01:09 |