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Will Supreme Court’s Citizens United Decision Doom McCarran-Ferguson Repeal?

Posted  February 2, 2010

The prospects for repeal of the McCarren-Ferguson Act’s antitrust exemption for health insurers may have gotten a bit dicier with the Supreme Court’s landmark decision giving the green light to corporate spending in political elections.

The Court in Citizens United v. Federal Election Commission held that the government may not ban “independent expenditures” for “political speech” by corporations in elections.  The essence of the 5-4 opinion is that the government can no longer suppress political speech on the basis of the speaker’s corporate identity.

Prior to the opinion, corporations were banned from taking money out of their general funds to pay for the broadcast of commercials advocating the election or defeat of a political candidate shortly before a federal election.  The opinion overruled the two precedents – Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990), and McConnell v. Federal Election Commission, 540 U.S. 93 (2003), which upheld restrictions on corporate political spending.

The decision could have a significant impact on the current healthcare reform movement.  The repeal of the McCarran-Ferguson Act, which exempts health and medical malpractice insurers from the federal antitrust laws, as reported in earlier posts, could be in jeopardy.  Health insurance companies are no longer restricted from paying for political advertisements which could persuade voters to elect candidates who are unlikely to support the repeal.

President Obama criticized the decision calling it “a major victory for big oil, Wall Street banks, health insurance companies and the other powerful interests that marshal their power every day in Washington to drown out the voices of everyday Americans.”

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