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Competitive Health Insurance Reform Act of 2011
H.R. 1150112th Congress

Competitive Health Insurance Reform Act of 2011

Introduced in the HouseRep. Paul Gosar (R-AZ-1)14 sections · 2 min read
Version: Introduced in House · Mar 17, 2011

Section 1. Short title

This Act may be cited as the Competitive Health Insurance Reform Act of 2011.

Section 2. Findings

The Congress finds the following:

(1) Open, free, and fair competition has made the United States the strongest economy in the world.

(2) As a general proposition, Government should ensure that no industry obtains an unfair competitive advantage and that the playing field is equal. The Congress should not play favorites with certain industries or special interest groups by exempting one group from the general application of the law.

(3) There is no factual basis supporting any further exemption of the insurance industry from Federal antitrust and unfair competition laws.

(4) Enforcement of these laws is most appropriately done through the U.S. Department of Justice, and in the case of aggrieved individuals through private actions as set forth in the existing statutes, but that class actions suits based on antitrust theories can themselves pose a hindrance to competition among insurance companies, and to higher prices for consumers, because of the resources they can consume.

Section 3. Purpose

It is the purpose of this Act to ensure that health insurance issuers and medical malpractice insurance issuers are subject to the same antitrust and unfair trade practices laws that all businesses have had to comply with and that these issuers would be subject to Federal laws against price fixing, bid rigging, or market allocations to the detriment of competition and consumers. This Act remedies a special exemption provided by Congress in 1945 to respond to the United States Supreme Court decision entitled United States v. South-Eastern Underwriters Association, wherein the Court correctly held that the Federal Government could regulate insurance companies under the authority of the commerce clause in the Constitution. This Act would also retain enforcement of these laws with State and Federal law enforcement agencies and allow private causes of action by aggrieved consumers harmed by unfair trade practices, but would prohibit class actions based on antitrust legal theories against insurance companies.

(a) Amendment to McCarran-Ferguson Act

Section 3 of the Act of March 9, 1945 (15 U.S.C. 1013), commonly known as the McCarran-Ferguson Act, is amended by adding at the end the following:

(c) Nothing contained in this Act shall modify, impair, or supersede the operation of any of the antitrust laws with respect to the business of health insurance. For purposes of the preceding sentence, the term antitrust laws has the meaning given it in subsection (a) of the first section of the Clayton Act, except that such term includes section 5 of the Federal Trade Commission Act to the extent that such section 5 applies to unfair methods of competition.

(b) Related Provision

For purposes of section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to the extent such section applies to unfair methods of competition, section 3(c) of the McCarran-Ferguson Act shall apply with respect to the business of health insurance without regard to whether such business is carried on for profit, notwithstanding the definition of Corporation contained in section 4 of the Federal Trade Commission Act.

(1) Limitation

No class action may be heard in a Federal or State court on a claim against an insurer for a violation of any of the antitrust laws (as defined in section 3(c) of the Act of March 9, 1945 (15 U.S.C. 1013), commonly known as the McCarran-Ferguson Act).

(2) Exemption

Paragraph (1) shall not apply with respect to any action commenced—

(A) by the United States or any State; or

(B) by named individual claimants for their particular injuries.

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