Insurance companies are exempt from Sherman Anti-trust and when they were mutual companies (owned by policy holders).. this was done in 1938 by the McCarrin-Ferguson act.. so that the insurance companies could "share data" to better establish broader risk tables. In the 90's the major health insurers "de-mutalized" which means that they are now public - for profit - companies with stockholders and the policy holders have no vested interest in the company.
So now we have public held companies with total exemption from what is considered ILLEGAL by any other public held company. I have read ... that some state's insurance oversight boards will not even consider intervening in a health insurance rate increase until it EXCEEDS 50% in a given year.
So what better business to be in... one that is exempt from any all actions - including price fixing - and have assurance that until you exceed raising your rates > 50% per year .. that no one is going to bother you.
Makes the 10%-12% annual increases for brand name drugs ... look pretty benign.
|