Why were health insurance companies exempt from anti-trust legislation?
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They are not allowed to form monopolies. The McCarran-Ferguson Act of 1945 was passed in response to the Supreme Court case United States v. South-Eastern Underwriters. The act allows state's regulate the insurance industry without federal government interference. Prior to the Supreme Court ruling, issuing policies was not considered commerce that could be regulated by Congress under the Interstate COmmerce Clause. McCarran-Ferguson returned the primary task of regulation to the states. It doesn't mean that the federal government can not regulate the industry, it just means the anti-trust laws don't apply.
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