ENDING INSURANCE COMPANIES' CONTROL OF THE MARKET

For over sixty years, insurance companies have enjoyed a significant competitive advantage - an exemption from federal anti-trust laws. During that time, they've managed to gain outright control of markets in 21 states and have a highly concentrated presence in 94 percent of the insurance markets in the United States. This unchecked power has reduced competition, permitted unfair industry practices and driven up costs for American businesses and consumers. The Health Insurance Industry Antitrust Enforcement Act of 2009 revokes this exemption, restores competition to the markets and protects the American people.

INSURANCE COMPANIES CURRENTLY HAVE THE RIGHT

TO CONTROL THE MARKET

Insurance Companies Antitrust Exemption is Unwarranted. Currently, the insurance industry has an exemption to the United States' antitrust laws. This exemption has allowed them to remain shielded from federal regulation for 64 years. [Business Week, 10/19/09]

Insurance Companies Control a Significant Share of the Market. "In the past 13 years more than 400 corporate mergers have involved health insurers, and a small number of companies now dominate local markets. The American Medical Association reports that 94 percent of insurance markets in the United States are now highly concentrated. Contrary to industry assertions, these mergers have undermined market efficiency; premiums have skyrocketed, increasing more than 87 percent, on average, over the past six years." [Health Care for America Now, 5/09]

In Nearly 40 States, More Than Half the Insurance Market is Controlled by 2 Insurance Companies. "In at least 21 states, one carrier controls more than half the market. More than half of the market is controlled by two carriers in at least 39 states." [Center for American Progress, 6/09]

* Alabama's Market is Dominated by One Insurer. "In Alabama, the biggest insurer holds 89 percent of the statewide market, the highest rate in the nation for a single company." [Health Care for America Now, 5/09]

States With Higher Rural Populations Lack Insurance Market Competition. "In Hawaii, Rhode Island, Alaska, Vermont, Alabama, Maine, Montana, Wyoming, Arkansas and Iowa, the two largest health insurers control at least 80 percent of the statewide market." [Health Care for America Now, 5/09]

* And States With Higher Populations Also Lack Competition. "More populous states have serious market concentration problems as well. Virginia's largest health insurer controls a 50 percent share of the statewide market." [Health Care for America Now, 5/09]

The More Local the Market, the More Control One Insurance Company Enjoys. "At the local level, where distinct provider markets exist in metropolitan areas, the health insurance industry's market concentration is even more severe. The U.S. Justice Department considers a market 'highly concentrated' if one company holds more than a 42 percent share of that market, a level that is common in Virginia and more than 30 other states. In Abilene, Texas, for example, the top insurer controls 85 percent of the market. In Bangor, Maine, the biggest insurer controls 74 percent of the market. The market leader in the Battle Creek, Michigan, area holds 83 percent, and 57 percent of the Lincoln, Nebraska, market is served by a lone insurer." [Health Care for America Now, 5/09]

The Health Insurance Industry Antitrust Enforcement Act of 2009

RIGHTS THIS WRONG

The Health Insurance Industry Antitrust Enforcement Act:

* Restores Market Competition. The Health Insurance Industry Antitrust Enforcement Act repeals the federal antitrust exemption for health insurance companies, opening up markets that have been under the control of a handful of insurers. Repealing this exemption will restore true competition and benefit consumers. [Senate Judiciary Committee]

* Makes Insurance Companies Subject to the Same Laws Other Companies Must Obey. This legislation makes insurers subject to the normal laws of competition, like all other companies doing business in the United States. [Senate Judiciary Committee]

* Allows States to Continue to Regulate Insurance Companies. This legislation doesn't affect the ability of each state to regulate the insurance business; it just applies federal antitrust law to the insurance industry. [Senate Judiciary Committee]