Obama backs repeal of insurer antitrust exemption

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The Obama administration said on Tuesday it has thrown its weight behind a bid to repeal an anti-trust exemption that has protected US health insurers for about 65 years.

"Today the president announced the administration's strong support for repealing the anti-trust exemption currently enjoyed by health insurers," White House spokesman Robert Gibbs said at a daily news briefing, two days before President Barack Obama hosts a bipartisan summit on healthcare.

"At its core, health reform is all about ensuring that American families and businesses have more choices, benefit from more competition and have greater control over their own healthcare. Repealing this exemption is an important part of that effort," he said.

Health insurers for about 65 years have been exempt from federal antitrust laws, which are designed to protect consumers from price fixing and other anti-competitive acts. The insurance industry has said the exemption is warranted because health insurers are regulated by states.

Gibbs said the House of Representatives is considering legislation to revoke the antitrust exemption over the next couple of days. Obama's support was transmitted to Congress as a statement of administration policy.

The Obama administration has stepped up its rhetorical attacks on the health insurance industry recently as it prepares for the summit, which some consider a last-ditch bid to revive the stalled overhaul of the USD 3.5 trillion US healthcare industry.

The administration has pointed to premium increases of up to 39% set by WellPoint Inc.'s Anthem Blue Cross unit in California as evidence of the need for a healthcare overhaul.

A number of House Democrats have said repealing the antitrust exemption is a high priority. The House-passed version of the healthcare reform bills that have stalled in Congress included a repeal of the exemption.

The Senate version did not. Obama's proposal for a healthcare overhaul, posted on Monday, in general more closely resembled the Senate plan.

A number of lawmakers and consumer groups support repeal of the exemption. They argue that states often lack the resources to regulate the insurance industry effectively.