Earlier today, the Big "I" submitted testimony to a congressional hearing outlining its concerns regarding legislation that would repeal the limited antitrust exemption for health insurers.

The hearing, held by the U.S. House of Representatives Judiciary Committee Subcommittee on Regulatory Reform, Commercial and Antitrust Law, focused on H.R. 372, the “Competitive Health Insurance Reform Act of 2017,” introduced by Rep. Paul Gosar (R-Arizona).

The McCarran-Ferguson Act was signed into law in 1945 in order to affirm the primacy of state insurance regulation. Pursuant to McCarran-Ferguson, state-regulated insurance companies hold a limited exemption from federal antitrust laws.

One of the main benefits of the exemption is that it allows insurers to share information about insurance losses so that the insurance industry can better project future losses and charge actuarially based prices for their products. The ability to pool data increases market competition by giving small insurers access to large data sets that are necessary for appropriately rating insurance products.

As introduced, H.R. 372 would repeal the exemption for health insurers, but would keep the exemption in place for other lines of insurance, such as property-casualty and life insurance.

The Big “I” strongly supports state insurance regulation and the limited antitrust exemption for the insurance industry under the McCarran-Ferguson Act. The association believes the exemption is vital to the competitiveness of state property-casualty insurance markets, and that repealing it is highly unlikely to increase competition. Doing so might actually lead to the opposite in the country’s health insurance markets.

Also today, the House Committee on Financial Services Subcommittee on Housing and Insurance held a hearing on the covered agreement on insurance and reinsurance that the U.S. Department of Treasury and the U.S. Trade Representative reached with the European Union just before President Obama left office.

The agreement is intended to support U.S. insurance companies that are subject to oversight by the EU, and removes certain collateral requirements for foreign reinsurance companies. During the hearing, state regulators expressed concern that the negotiation process for the agreement was not transparent and that the U.S. could have gotten a better deal.

Jennifer Webb is Big “I” federal government affairs counsel.