U.S. Congresswoman Kathy Castor and a majority in the House of Representatives sided with American families and small businesses today over health insurance companies by passing the Health Insurance Industry Fair Competition Act. The bill will end the antitrust exemption enjoyed by health insurance companies and will mean more competition for consumers.

“It is time for policymakers to decide whose side they are on: health insurance companies or American families and small business,” Castor said today on the House floor. “The answer is clear. No more favors for private insurance companies. The current state of the law is unfair. Health insurance companies currently enjoy an exemption from antitrust laws with no good justification. Meanwhile, American families are held hostage to rising health care costs. This legislation will spur fair prices and real competition.”

Health care costs have skyrocketed in the past year, according to a report released this month by Health Care for America Now. The report showed that the nation’s five largest for-profit insurance companies reported $12.2 billion in profits in 2009, a 56 percent increase from 2008, while dropping coverage of 2.7 million Americans. The report also showed that the share of premium dollars spent on health care expenses generally decreased, while the proportion spent on administrative expenses and profits generally increased.

In Florida, health care premiums rose 3.7 times faster than wages from 2000-2009, according to FamiliesUSA. Premiums rose by more than 98 percent while paychecks rose by about 27 percent.

Health insurance companies and Major League Baseball are the only industries that enjoy an exemption from federal antitrust laws. The antitrust exemption shields insurance companies from legal accountability for price fixing, dividing up territories among themselves, sabotaging their competitors in the marketplace in order to gain monopoly power,and other practices that harm consumers.

“Health insurance companies currently have an incentive to collude and cherry pick customers – exacting huge profits out of the health of American families,” Castor said.

 “One of the main tenets of our health insurance reform effort is to create greater transparency,” Castor said. “Bringing in more competition is going to shed more light on their practices. We are putting an end to health insurance companies’ ability to collude and compare prices. That can only drive down costs for consumers. With this legislation, consumers win.”