GOP senators link support for payroll tax cut package to looser bounds on physician-owned hospitals

Republican senators involved in reconciling the House and Senate versions of the payroll tax cut and other expiring provisions said any deal should ease the health law's restrictions on doctor-owned hospitals.

"That too is a matter that is in some contention," Sen. Jon Kyl (R-Ariz.) told a conference of the American Medical Association on Tuesday. "Neither side wants to give. I've made it clear to [Sen. Max Baucus (D-Mont.), the top Democratic negotiator] that Congress cannot declare that the Senate position is bipartisan as long as" it doesn't address the issue.

President Obama's healthcare reform law bans new physician-owned hospitals from participating in the Medicare program and restricts existing ones' ability to expand. Democrats say the institutions unfairly compete with other hospitals and drive up healthcare costs through unjustified patient referrals. But critics say the restrictions are too burdensome, barring even some hospitals that were under construction at the time of the law's passage from being completed.

The payroll tax cut package that passed the House late last year would make it easier for existing physician-hospitals to expand. The Senate version has no such provision, however, and Democrats have little desire to revisit the issue.

Still, Kyl said he and the two other Republican senators on the conference committee — John Barrasso (R-Wyo.) and Mike Crapo (R-Idaho) — were "strongly convinced that some review" of the restrictions was in order.

"I think it's an important issue," Barrasso told The Hill. "I would like to see it included in any kind of conference agreement."

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