While the legislature has decided not to act on E2SHB 1589 at this time, the issue remains a priority for many providers and stakeholders. With continued advocacy and careful preparation, there is an opportunity to shape a future bill that balances the needs of providers, insurers, and patients alike.


Engage in Activities INDIVIDUALLY


Be mindful that federal anti-trust laws prohibit providers who are not in the same tax ID from boycotting a contract, and taking action collectively. There are multiple laws that prohibit providers from specific behavior. Below is a short list of laws and links for your reference. Both the individual provider(s) and the state association are subject to anti-trust laws and the enforcement is up to the Department of Justice using THEIR “Rule of Reason.” I am not willing to take that risk, nor should you!


Key Antitrust Laws:


• Sherman Act (1890): Prohibits anticompetitive practices, including agreements to restrain trade and attempts to monopolize.


• Clayton Act (1914): Addresses anticompetitive mergers and acquisitions, and certain other behaviors.


• Federal Trade Commission Act (1914): Created the Federal Trade Commission (FTC), which enforces antitrust laws, including those related to healthcare.


Anti-Competitive Practices in Healthcare:


• Price-fixing: Agreements among competitors to raise, fix, or maintain the price of goods or services. • Bid-rigging: Agreements in advance on the price or terms of competitive bids.


• Market allocation: Agreements to divide markets among competitors, such as agreeing to sell only to specific customers or areas.


• Boycotts: Agreements to exclude certain providers or products. • Exclusionary practices: Actions that limit access to healthcare services or resources, such as granting exclusive staff privileges to a single specialty group.


• Mergers and acquisitions: Combining hospitals, insurers, or other healthcare entities that could reduce competition.


Enforcement:


• The U.S. Department of Justice (DOJ) and the FTC share authority to enforce antitrust laws.


• The DOJ handles criminal violations, while the FTC focuses on civil enforcement.


The McCarran-Ferguson Act, enacted in 1945, generally exempts the “business of insurance” from federal antitrust laws, but this exemption has been narrowed for health insurance, with the Competitive Health Insurance Reform Act (CHIRA) repealing some of that immunity.


References: Links related to “Key Antitrust Laws” and “Enforcement” sections above 1. https://www.ftc.gov/advice-guidance/competition-guidance/guide-antitrust-laws/antitrust-laws 2. https://www.ftc.gov/legal-library/browse/statutes/clayton-act 3. https://www.ftc.gov/legal-library/browse/statutes/federal-trade-commission-act 4. https://www.ftc.gov/ 5. https://www.doj.gov/ 6. https://uscode.house.gov/view.xhtml?path=/prelim@title15/chapter20&edition=prelim 7. https://www.congress.gov/bill/116th-congress/house-bill/1418


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Here’s a more detailed explanation:


The McCarran-Ferguson Act


This act, in essence, grants states the primary authority to regulate the insurance industry and provides an exemption from federal antitrust laws for the “business of insurance”.


The CHIRA


The Competitive Health Insurance Reform Act (CHIRA), signed into law in January 2021, limits the application of the McCarran-Ferguson Act as it relates to the business of health insurance.


Impact of CHIRA CHIRA repeals the antitrust immunity for health insurers, except for certain activities like collecting, compiling, or disseminating historical loss data, determining loss development factors, performing actuarial services, or developing/disseminating standard insurance policy forms (if adherence isn’t required).


Antitrust Laws and Health Insurance The repeal of the McCarran-Ferguson exemption for health insurance means that the federal antitrust laws, designed to prevent anti-competitive practices, now apply more directly to health insurers.


Focus of Enforcement


This shift in the law aims to ensure that health insurers are subject to the same competitive rules as other industries, potentially leading to more competitive pricing and benefits for consumers.


Examples of Anticompetitive Practices Before the CHIRA, the McCarran-Ferguson exemption had allowed some insurers to engage in practices like price-fixing, market allocation, or other collusive arrangements that could harm consumers.


Ongoing Debate


The repeal of the McCarran-Ferguson exemption for health insurance has been a subject of ongoing debate, with some arguing that it is necessary to promote competition and consumer choice, while others argue that it could disrupt the insurance market and lead to unintended consequences.


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