WASHINGTON -- Last week,

, D-Ore., went on the attack against the nation's biggest oil companies and financial institutions.

This week he's gunning for another big industry, arguing that health insurance companies are driving premiums to artificial heights because federal law exempts them from anti-trust law.

“No matter what political ideology, most can agree that insurance companies should play by the same rules as virtually every other industry in America," DeFazio said Tuesday, publicly renewing his effort to change what he says is a misguided federal law.

"Right now, it is legal under federal law for insurance companies to collude to drive up prices, limit competition, conspire to underpay doctors and hospitals, and price gouge consumers," DeFazio said.

His timing is good in one respect - the cost of health insurance in Oregon has earned a high profile since the state's largest health insurer,

for 59,000 customers.

The proposed 22.1 percent increase is an average; some people could see their rates go up more or less depending on their circumstances.

is scheduled to hold a hearing today on the rate increase request. The hearing will be held at Portland State University.

The proposed rate increase would take effect Aug. 1. It applies to policies sold to individuals, not employer groups. The insurance division regulates prices of individual, small-group and portable health plans. It has the authority to approve or deny requests or approve lesser rates.

Regence says the price hike is necessary to cover the rising costs of medical services and prescription drugs.

"Health care costs for our individual pool are increasing, while the number of people sharing the burden of those costs is shrinking," a statement issued by the company said. "The rates we have requested in this filing are a direct reflection of these costs."

The average cost of individual coverage sold by all companies in Oregon rose by about 15 percent in each of the past two years, and by more than 21 percent in 2008. A 2009 state law gave the Oregon Insurance Division more authority to review rate requests, and Oregon and other states received $1 million federal grants to improve health insurance rate review.

Oregon hired four more people to review insurance company filings and awarded a $100,000 grant to a consumer advocacy group to independently review and comment on rate increases.

The agency says it disallowed half of the rate increases insurers originally requested between March 2010 and April 2011. ODS Health Plan, for example, sought a 20.7 percent increase for individual policies but got 17.5 percent. Providence Health Plan requested an 18 percent increase and was granted a 13 percent increase. On average, the division says the rates it approved reduced insurance company requests by 4 percentage points, saving about $10 per person on monthly insurance premiums.

DeFazio and other industry critics say the absence of strong anti-trust oversight on the federal level provides lots of room for collusion and artificially high premiums. The bill he introduced with

, is similar to one that achieved an overwhelming victory in the House last year. The bill passed in February 2010 by 406-19.

The House also included similar language in the health care reform bill, but the language was dropped during the messy negotiations before the bill cleared Congress in December 2009.

Despite the rugged history, the concept enjoys broad support as many lawmakers believe health insurance companies take advantage of lax oversight to drive premiums higher than necessary.

“I’ve heard too many complaints about the health insurance industry engaging in price fixing, bid rigging, and other anti-consumer and anti-competitive practices," Slaughter said. "It’s well past time that Congress act to strike this sweetheart deal. The last Congress knew this to be a bipartisan and sensible proposition. I hope this Congress knows that as well.”

The exemption was granted in 1945 with passage of the McCarran-Ferguson Act which bestowed on insurance companies a privilege shared by only a few other industries, including Major League Baseball and railroads.

In return, oversight of insurance became the responsibility of states, leading to what critics like DeFazio claim is a fractured, under-financed and ineffective system.

"A recent study shows that in six of the seven most concentrated markets for health insurance—no significant consumer protection actions have been taken against health insurers in the past five years. This result has allowed insurance companies to collude amongst themselves," DeFazio said in a background paper on the subject.

If his bill passes, "It will end this practice by subjecting the health insurance industry to all federal anti-trust laws and by giving the Department of Justice the authority to go after anti-competitive practices of health insurers if the states are unable or unwilling to do it themselves."

Ironically, the bill also has support in the Senate even though past efforts have died in that chamber.

, who chairs the Judiciary Committee, has supported the legislation in past years along with at least 20 others in the chamber. But because of the Senate's procedural rules, a single senator can bottle up legislation.

DeFazio will also have to defeat the health insurance industry's wealthy and influential trade group if he hopes to advance the bill. That has proved impossible in the past and congressional aides say opposition from the group will be no less formidable this time.

There's also a political change since the bill passed last year - Republicans now control the House and it's unclear if they will be willing to back the effort.

Moreover, the powerful trade group for the health insurance industry is certain to oppose the effort again. In past years, the group,

, has successfully defeated all efforts to remove antitrust protection.

“In attempting to solve a problem that doesn’t exist, this legislation is the triumph of sound bites over substance," AHIP President Karen Ignagni wrote in 2010.

has said that passage of this legislation will do nothing to reduce health care costs. Moreover, according to the National Association of Insurance Commissioners, anti-competitive ‘activities are not permitted under the McCarran-Ferguson Act and are not tolerated under state law.’ Real reform means containing costs to ensure that health care is affordable for working families and small businesses. It’s time to clear the political hurdles that stand in the way of real cost containment,” the letter said.

State regulators weren't thrilled either by previous efforts and are likely to fight DeFazio too.

"The most likely result of this repeal would therefore not be increased competition, but a series of lawsuits testing the limits of the state action doctrine, with associated litigation costs being passed along to consumers in the form of higher premiums,"

wrote.

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