and outpatient hospital services" encompasses lithotripsy, we
turn to the statute's purpose and legislative history.
2. Purpose and Legislative History
Plaintiffs argue that the legislative history of Stark II
reveals Congress' clear intent not to include lithotripsy in
the category of "inpatient and outpatient hospital services."
Plaintiffs point to the colloquy on the House floor in which the
bill's sponsor, Rep. Stark, confirmed in response to a question
from another member that lithotripsy provided under arrangement
with a hospital was not included in this category. See 139
Cong.Rec. H6238 (Aug. 5, 1993).
Defendant has not been able to identify any conflicting
legislative history which might call into question the
unequivocal assertion contained in this colloquy. Instead,
defendant merely cites cases cautioning against giving great
weight in statutory interpretation to statements made by members
of Congress during floor debates. See, e.g., Texas Mun. Power
Agency v. EPA, 89 F.3d 858, 874 (D.C.Cir. 1996) (stating that
"judges must `exercise extreme caution before concluding that a
statement made in floor debate . . . may be taken as statutory
gospel,' in light of the `endemic interplay, in Congress, of
political and legislative consideration[s]' likely unrelated to
the interpretive tasks of a court"), Chemical Mfrs. Ass'n v.
EPA, 919 F.2d 158, 165 (D.C.Cir. 1990) (stating with regards to
a floor colloquy that the court "would be reluctant to give
controlling weight to an isolated exchange of this type"). While
this advice is well taken, courts' engaging in statutory
interpretation regularly examine floor colloquies as one part of
their analysis of the statute's overarching legislative history.
See e.g., Chevron, 467 U.S. at 852 n. 25, 853, 104 S.Ct. 2778.
Here, plaintiffs have cited other aspects of the legislative
history that support the floor colloquy.
A complete grasp of the legislative history of Stark II cannot
be obtained without connecting it to its predecessor, Stark I.
As ultimately enacted, Stark I prohibited physician
self-referrals only with respect to clinical laboratory
services. See 42 U.S.C. § 1395nn. However, the bill had
originally been crafted as a blanket prohibition on all such
referrals, with a specific exception for lithotripsy. See H.
Rep. No. 101-247, 101st Cong. 1041 (1989). The bill thus
mirrored the Florida statute that it was explicitly modeled
after and which also functioned as a blanket prohibition with a
specific exception for lithotripsy, an exception based upon a
study commissioned by the Florida legislature which showed no
risk of overutilization of lithotripsy by physician
self-referrals. See FLA. STAT. § 455.236. Thus, the exception
for lithotripsy in the draft federal bill was consistent with
the bill's purpose of discouraging overutilization of medical
services. When the scope of the Stark I bill was narrowed in
committee, there was no longer any need for the lithotripsy
exception because lithotripsy is not a clinical laboratory
service. Thus the exception was removed.
Plaintiffs argue that this background demonstrates that
Congress has never regarded lithotripsy as part of the
self-referral problem and therefore has consistently acted to
exclude lithotripsy from its regulation of self-referrals.
Defendant argues in response that the 1989 House Conference
Report, which contained the original draft of Stark I with the
exception for lithotripsy, shows that Congress "was plainly
aware of how" to make an exception for lithotripsy, and that
therefore the fact that Congress did not make such an exception
in Stark II disproves that it intended that lithotripsy not be
included in "inpatient and outpatient hospital
services." Defendant further contends that since the legislative
history this argument relies upon is a Conference Report, it
should be given greater weight than the colloquy cited by
plaintiffs. See U.S. v. Commonwealth Energy Sys. and Subsidiary
Cos., 235 F.3d 11, 16 (1st Cir. 2000) (stating that "[h]ere,
where there is a Conference-Report, the district court's
extensive reliance on the remarks of one member is misplaced").
Defendant's argument attempts to turn the legislative history
on its head. Stark II, like Stark I, is structured not as a
blanket prohibition but as a ban on referrals for specific kinds
of services. Therefore, as with Stark I, Congress would not have
felt a need to create a lithotripsy exception. The fact that
Congress did not create such an express exception does not mean
that Congress did not consider lithotripsy at all. When a new
category-"inpatient and outpatient hospital services"-was added
to the list of designated health services towards the end of
legislative deliberations, members sought to ensure in the
colloquy that it would not cover lithotripsy and thus would not
violate their longstanding intent to keep lithotripsy out of
self-referral regulation. Because the Conference Report and the
colloquy are perfectly consistent under this interpretation,
whereas defendant's argument would place them at odds, the
Conference Report actually lends more support to plaintiffs'
The same rationale refutes defendant's argument that because
the purpose of the statute is to reduce overutilization of
medical services caused by self-referrals, Congress ipso facto
must have intended it to prohibit self-referrals for
lithotripsy. In fact, both the state of Florida and Congress
have recognized that there is no such risk of overutilization
with lithotripsy by excepting it from blanket prohibitions on
self-referrals. The study commissioned by the Florida
legislature found no such risk, and defendant has been unable to
cite a study to the contrary. Indeed, CMMS recently acknowledged
that lithotripsy is not susceptible to such abuse:
Only when a patient requires surgical treatment would
a physician prescribe [lithotripsy]. When a patient
needs additional treatment, there is no alternative
available that is less invasive or less expensive
than [lithotripsy]. In addition, the procedure itself
apparently documents the medical necessity to
prescribe it . . . [T]he kidney stone is located,
identified, and the progress of the therapy is
recorded as part of the visualization process . . .
[W]e agree that it might be unlikely that physicians
would over-utilize [lithotripsy]. 63 Fed. Reg. 1659,
1682 (Jan. 9, 1998).
Taken together, the lack of any mention of lithotripsy in the
Stark II statute itself, the legislative history of the statute,
and the statute's purpose demonstrate a clear intent on the part
of Congress not to subject lithotripsy to the ban on
self-referrals by including it in "inpatient and outpatient
hospital services." Because of this clear evidence of
Congressional intent, the court need not reach the second prong
of the Chevron analysis and determine whether defendant's
regulation was a reasonable interpretation of the
For the foregoing reasons, the court concludes that
defendant's regulation classifying lithotripsy as an "inpatient
[or] outpatient hospital service" under Stark II violates the
APA and must be set aside. The court therefore grants
plaintiffs' motion for summary judgment as to that issue, and
denies defendant's motion for summary judgment. An appropriate
order accompanies this memorandum.
Pursuant to Fed.R.Civ.P. 58 and for the reasons stated by the
court in its memorandum docketed this same day, it is this 12th
day of July, 2002, hereby
ORDERED that defendant's regulation including lithotripsy
within the designated health service "inpatient and outpatient
hospital services" is invalid and of no force and effect; and it
ORDERED that defendant is permanently enjoined from
implementing and enforcing said regulation.