McCarran-Ferguson Act No Defense Against RICO.

In Humana Inc. v. Forsyth, 119 S.Ct. 710 (1999), the U.S. Supreme Court rejected the idea that the McCarran-Ferguson Act works a sort of field preemption, but it also turned down the idea that Congress can regulate the "business of insurance" whenever the federal law does not collide head on with state regulation. The result of the case is that purchasers of Humana group health insurance may sue Humana under the federal Racketeer Influenced and Corrupt Practices Act, 18 U.S.C. [sections] 1961 et seq.

Humana agreed in its health policies to pay 80 percent of hospital charges over a designated deductible, with insureds responsible for the remaining 20 percent. A group of Nevada policyholders complained that Humana by a concealed agreement received large discounts on its portion of the hospital's charges, the result of which was that in the end Humana paid less than 80 percent and the insureds more than 20 percent of the hospital's stated charges.

The insureds sued under RICO, which permits treble damages, but the district court granted Humana summary judgment on the ground that the treble damages provision so exceeded Nevada statutory penalties that applying RICO would contravene McCarran-Ferguson's dictate, "No act of Congress shall be construed to invalidate, impair, or supercede any law enacted by any state for the purpose of...