85R20232 BPG-D     By: Zedler H.C.R. No. 120       CONCURRENT RESOLUTION          WHEREAS, Antitrust laws are crucial to ensure that the free   market works for consumers, but the McCarran-Ferguson Act of 1945   created a special exemption from federal antitrust laws for   insurance companies; and          WHEREAS, In 1944, the Supreme Court's decision in United   States v. South-Eastern Underwriters clarified that the business of   insurance is interstate commerce and subject to existing antitrust   laws; the following year, Congress responded by hurriedly passing   the McCarran-Ferguson Act, which permitted state regulation of   insurance companies; a section of the act was also crafted to   provide insurers with a three-year moratorium during which they   could study federal antitrust laws and adjust their practices to a   competitive marketplace; however, a seemingly innocuous phrase   inserted in the bill in conference committee was later interpreted   by the courts such that the temporary delay became broad, permanent   immunity, completely contrary to the intent understood by all,   including President Franklin Roosevelt, who specifically discussed   the limited moratorium upon signing the act; and          WHEREAS, The exemption from antitrust laws has allowed   insurance companies to collude to drive up prices, share or divide   markets, restrict coverage, and reduce payouts; some lines of   insurance, including property and casualty insurance, have formed   cartel-like rating bureaus that collect and pool claims data from   different companies, enabling them to engage in joint   price-setting, joint policy-language development, and the use of   the same or similar computer programs designed to systematically   underpay claims; health insurers have banded together to share   pricing information, and premiums have soared sharply while doctors   and hospitals are underpaid; and          WHEREAS, Unfettered by antitrust regulations, a handful of   insurers have so dominated their markets that consumers have little   or no choice in providers; more than 90 percent of health insurance   markets in more than 300 metropolitan areas have become "highly   concentrated," as defined by the Federal Trade Commission,   according to the American Medical Association; a 2008 survey by the   Government Accountability Office found the five largest providers   of small group insurance controlled 75 percent or more of the market   in 34 states, while in 23 of those states, they controlled 90   percent or more of the market; and          WHEREAS, Competition is the cornerstone of our economic   system, but for nearly seven decades, the insurance industry's   singular immunity from antitrust laws has allowed excessive   corporate concentration to distort the marketplace; ending this   special treatment would check monopolistic practices, spurring   competition that would improve coverage and expand choices while   bringing down costs for American consumers and businesses; now,   therefore, be it          RESOLVED, That the 85th Legislature of the State of Texas   hereby respectfully urge the United States Congress to end the   antitrust exemption for insurers; and, be it further          RESOLVED, That the Texas secretary of state forward official   copies of this resolution to the president of the United States, to   the president of the Senate and the speaker of the House of   Representatives of the United States Congress, and to all the   members of the Texas delegation to Congress with the request that   this resolution be entered in the Congressional Record as a   memorial to the Congress of the United States of America.