Senators negotiating the farm bill have withdrawn a suggestion that the conference report include a ban on physicians’ referrals to their own specialty hospitals, bowing to House lawmakers’ objections. The ban, as an offset, is scored as raising $2.4 billion over 10 years and is supported by Finance Chairman Max Baucus, ranking member Charles Grassley, and Senate Republican Conference Chairman Lamar Alexander of Tennessee. Last Friday, Senate Minority Whip Kyl and House Energy and Commerce ranking member Joe Barton sent a letter to farm bill conferees protesting the self-referral ban as part of the farm bill. Kyl and Barton are also asking CBO to explain its scoring of the provision, noting that it has changed its assessment several times over the last few months and has assigned “minimal savings” to the provision in the past. The letter has signatures from three other senators and 23 representatives. The American Medical Association also put out a statement Thursday protesting the ban. Opponents say the provision would limit patient choice, while supporters say it presents a conflict of interest for physicians.
The outcry from Kyl, Barton and the AMA may have been unnecessary, according to aides familiar with the talks. Baucus raised the idea of including the specialty-hospitals provision last week, but he backed off when House lawmakers said they wanted the provision to remain a part of a mental health parity bill that passed that chamber last month. The provision also has tax language in it, which raises jurisdictional problems in the Ways and Means Committee, where all tax bills must originate. “We’re onto other bills,” said Federation of American Hospitals President Chip Kahn, who, along with the American Hospital Association and the Coalition of Full Service Community Hospitals, supports the self-referral ban.
In addition to the mental health parity bill, supporters are eyeing a Medicare bill expected on the Senate floor in mid-May and other “must-pass” legislation such as the Iraq supplemental spending bill. Supporters may have difficulty getting the language enacted this year, however. The administration opposes it, and the Kyl-Barton letter is being viewed as a warning to all lawmakers looking for offsets on any bill that they cannot simply slip the language in without notice.
This article appears in the April 26, 2008, edition of National Journal Daily PM Update.