By Adriel Bettelheim, CQ Staff

July 23, 2009 -- Responding to worries over the $1 trillion price tag attached to health care overhaul plans and resistance from several corners of Congress, President Obama is stepping up his salesmanship.

The president pushed back Wednesday night during a nationally televised news conference that largely revolved around his ambitious plan to retool the U.S. health system. Obama underscored the importance of completing work on a plan within weeks and prodded lawmakers not to succumb to political inertia.

The press conference provided a venue for Obama to again detail shortcomings in the current health system and portray opponents of the health plan as defenders of the status quo. He'll repeat the message on Thursday, when he travels to Cleveland for a town hall meeting during which he will again promote his plan and will make a visit to the Cleveland Clinic, which has been touted as a good example of recalibrating the approach to patient care.

The question is how hard will he lean on risk-averse centrist Democrats to heed his calls for swift action.

During the news conference, Obama responded to a "why the rush?" question about the time frame of the overhaul. "I'm rushed because I get letters every day from families getting clobbered by health care costs, and they ask me can you help," he said. "In a country like ours that's not right."

He also said that "if you don't set deadlines in this town, nothing happens. The default position is inertia."

In his opening remarks, the president again stressed the perils of inaction: "So let me be clear: if we do not control these costs, we will not be able to control our deficit. If we do not reform health care, your premiums and out-of-pocket costs will continue to skyrocket.

"If we do not act, 14,000 Americans will continue to lose their health insurance every single day. These are the consequences of inaction. These are the stakes of the debate we're having right now."

During the news conference Obama reiterated that at the beginning of his administration "we inherited an enormous deficit, enormous long-term debt projections" but insisted that "health care reform is not going to add to that deficit. It's designed to lower it."

Asked about his endorsement of a goverment-run plan to compete against private insurers, Obama said he believed the concept would "help keep the insurance companies honest. With regulation there already has been an improvement, but having a public plan out there...that shows maybe if you take some of the profit motive out...it might be even better."

The president also noted that insurance companies "are making record profits and premiums are going up. Where's the constraint? How can we be sure those costs aren't being passed on to employers or their employees? The way to do that is to have some competition."

Obama also referred to the health care initiative as "health insurance reform," a departure from his standard "health care reform."

Administration aides say the goal is to keep the broadest segment of the public believing it has a stake in the outcome, by focusing on how an overhaul will tamp down health inflation and make coverage more affordable to working-class families.

"It's important that the president continues to remind the American people what's at stake, what's in it for them, why the status quo is unacceptable and unaffordable, and what must be done in terms of this issue to lay that foundation for long-term economic growth," said White House press secretary Robert Gibbs. "I don't think he can probably say that enough."

However, experts say Obama faces a formidable political challenge. Polls suggest that voters are losing confidence in Obama's ability to control federal spending, and generally are questioning whether he is taking on too much at once.

The concerns have been amplified by projections from the Congressional Budget Office concluding the overhaul bills produced to date will increase, not reduce, the government's long-term health costs.

"A key turning point was when the Congressional Budget Office acknowledged the proposals don't address the core problems in health spending," said Scott Gottlieb, a former deputy FDA commissioner and top Medicare official in the administration of George W. Bush. "The plans have a lot of vehicles to control decision-making and payment structures, but they don't change the way health care is delivered."

Senate Minority Leader Mitch McConnell of Kentucky said Republicans want to work with Democrats on solutions that can pass on a bipartisan basis. He also said that the health care debate is not about the future of Obama's presidency.

"We want to do the right thing. It's not about the president. Some people think everything is about the president. It's not. It's about the country," McConnell said. "This is too important to be rushed."

Members of Obama's own party in Congress remain concerned about being forced to walk the plank and support an expensive bill few are certain can contain health care spending.

Many of the same lawmakers supported the $787 billion economic stimulus package that Republicans contend has not done enough to stabilize the economy.

Now, some of the Democrats are demanding political inoculation.

Members of the fiscally conservative House Blue Dog Coalition reached a "verbal agreement" with Energy and Commerce Chairman Henry A. Waxman, D-Calif., and Obama on Tuesday to work on language in a House overhaul bill (HR 3200) that would create an independent board with the power to influence payment rates for Medicare and possibly other programs.

"We consider that a significant breakthrough," said Mike Ross, D-Ark., who chairs the coalition's health care task force.

Obama on Wednesday said he understood the coalition's concerns. "I have also pledged that health insurance reform will not add to our deficit over the next decade—and I mean it," he said.

By Drew Armstrong, Alex Wayne and Edward Epstein, CQ Staff

July 24, 2009 -- Despite claims of a "significant breakthrough" on their health care overhaul bill, House leaders still face trouble from dissident Democrats who have blocked action in a key committee.

Majority Leader Steny H. Hoyer, D-Md., said that chances are "very small" they will bring the bill to floor before the House's scheduled July 31 break for the August recess. But he said it was possible the leadership would hold the chamber in session beyond that date. The Senate is not scheduled to begin its recess until Aug. 7.

"It's possible that we would move onto it Saturday the first, or Monday or Tuesday the 3rd and 4th, if need be," he said.

Hoyer also said a stalled Energy and Commerce Committee markup will proceed next week. Leaders will assess after the panel finishes its work whether to attempt a floor vote before the House leaves for its summer break, he said.

Meanwhile, Rep. Mike Ross, D-Ark., said there would be no deal Friday between conservative Blue Dog Democrats on the Energy and Commerce Committee and panel Chairman Henry A. Waxman. "It pretty much fell apart this afternoon," he said.

However, that didn't mean panel members had quit talking. All committee Democrats went into a closed-door session late Friday to assess where they stood on the bill.

Rep. Zach Space, D-Ohio, one of seven Blue Dogs who serve on Energy and Commerce, said they would stay at the table. "I think that there are some changes and some setbacks....But this is too important to just walk away from," he said.

Ross bristled at remarks Waxman made earlier in the day that he would not allow the Blue Dogs to help Republicans "take over the committee."

"We're actually trying to save the bill, and we're trying to save the party," Ross said. "That kind of rhetoric is not helpful."

Earlier Friday, Waxman and other leaders trumpeted "a significant breakthrough in resolving the outstanding issue of regional disparities in Medicare [payments] and therefore in the public plan" that the bill would create to compete with private insurers.

Blue Dog Democrats and others within the caucus had raised concerns about the differing rates that Medicare uses to pay doctors, hospitals and other health care providers.

Many members from rural areas say those rates are unfairly low, and they have refused to endorse a bill that does not address the problem—both in Medicare and the proposed public plan.

But Ross said the leadership had not gone far enough to satisfy Blue Dog demands for a beefed up, independent commission to set payment rates for Medicare and possibly other parts of the health system.

He said the Blue Dogs were not part of the deal to address regional disparities in Medicare payments. "That was a whole different group they've been negotiating with," he said.

Asked if he thought leaders were trying to bypass Blue Dogs, Ross said he thought leaders were trying to get votes where they could. "There will be a lot of deals made over the next few days to pick off votes," he said.

He predicted Blue Dogs would stick together in their demand for changes to the bill. Democrats, with 256 House seats, will need votes from the 52-member group to pass the bill, but Ross estimated at least 45 Blue Dogs currently would vote no.

Charlie Melancon, D-La., another Blue Dog on Energy and Commerce, said Waxman and Democratic leaders had not treated the group's suggestions seriously. He said the Blue Dogs had submitted a list of 10 items they wanted included or changed in the bill but were stonewalled.

"We never got anything back on any of them, and then summarily he [Waxman] took them off the table."

"They took nothing that we brought to them. Absolutely nothing. Not the first idea, not the first concept, nothing," Melancon said.

Markup or Bypass Route?

Waxman broke off his committee's markups early this week as the Blue Dogs made clear they could line up with panel Republicans to reshape the health bill.

He said early Friday he wanted to reach a deal with his Blue Dog members that would allow the committee "to go forward with a markup and not vote with Republicans to eviscerate the legislation." He added, "I will not allow them to turn over control of the committee to Republicans, as they've threatened to do."

Waxman said if he couldn't reach a deal that would hold panel Democrats in line behind a bill, "then my view is we're going to have to look at perhaps bypassing the committee."

"I think the Blue Dogs raised a number of important issues when we started the discussions," he said, "but we haven't been able to conclude any agreement. The discussions can't be interminable."

Ross said scrapping the markup was "a decision the chairman will have to make. I think it would be a mistake and a PR nightmare for the party. We're not trying to kill health care reform, we're trying to save it."

Although Waxman was clearly losing patience, party leaders for now threw cold water on the idea of halting the markup and discharging the bill from Waxman's committee.

"I'm not interested in that, and I don't think the Speaker is either," Hoyer said.

But he made clear the leadership isn't prepared to negotiate forever.

"Certainly interminable would be into the fall; we don't want to do that," Hoyer said.

Rep. Joe Barton of Texas, the top Republican on the Energy and Commerce Committee, predicted the rule for debate of the health overhaul would fail if the leadership were to take the bill directly to the floor at this point.

"I don't think that Speaker Pelosi really is going to do that," Barton added, saying it would amount to "a direct slap at all 36 of the Democrats" on Energy and Commerce, because it would eliminate their chance to amend the measure.

"I don't see the votes being there to get a rule on the floor," Barton said.

Regional Disparities

Under the deal outlined Friday by Waxman and others, the Institute of Medicine would conduct an analysis of regional disparities in Medicare rates and then send its assessment to the Department of Health and Human Services, which would implement the study's recommendations.

The Institute of Medicine is a non-profit organization of health policy experts chartered by Congress in 1970 as a component of the National Academy of Sciences. It provides independent analysis and guidance to Congress and others in government and the private sector.

"We assume there would be a change in rates," said Education and Labor Committee Chairman George Miller, D-Calif.

Ways and Means Committee Charles B. Rangel, D-N.Y., said Congress would have the option to block the new rates once the commission reports back.

House Democratic Caucus Chairman John B. Larson of Connecticut said early Friday he plans a multi-hour caucus meeting starting at 4 p.m. Monday to go through the health care overhaul (HR 3200) "section by section and answer every question members have."

The caucus will take a break at 6:30 p.m. for floor votes and then resume, continuing as long as needed into the night.

Larson said that even though the bill isn't final yet, most of the legislation is in writing and ready for members' analysis.

At a caucus meeting Friday morning, he passed out section-by-section summaries to members to take home and study over the weekend.

Richard Rubin and Jane Norman contributed to this story.

By Melissa Attias, CQ Staff

July 21, 2009 -- Nearly three-quarters of Americans who tried to purchase health care insurance on their own in the last three years did not end up buying a plan, most often because premiums were too high, according to a report released Tuesday by The Commonwealth Fund.

The report, entitled Failure to Protect: Why the Individual Insurance Market is not a Viable Option for Most U.S. Families, was based on a random sample of 1,517 adults, ages 19 to 64, who were surveyed by telephone between June 6 and Oct. 24, 2007. All participants were insured with private insurance for the entire year, but 1,387 had employer-sponsored insurance while 130 had individual insurance.

According to the data, 57 percent of adults who either had individual coverage or had shopped for it in the past three years said it was very difficult or impossible to find coverage they could afford. Forty-seven percent also found it very difficult or impossible to find coverage they needed, the report said, while 36 percent were turned down, charged a higher price or excluded due to a pre-existing condition.

"In our current system millions of people without access to employer coverage have no affordable option for health insurance," Karen Davis, president of The Commonwealth Fund, said in a news release. "To achieve a health care system that works for all Americans we need health care reform that offers comprehensive, affordable health insurance to everyone regardless of their health status, premium subsidies to help families with low and moderate incomes afford health insurance and requirements to ensure that no one is denied health insurance because of a health problem."

Yet a December 2007 analysis of the individual health insurance market by America's Health Insurance Plans (AHIP) found that approximately nine out of 10 Americans that went through the application process for individual insurance were offered coverage.

"Individual health insurance is more affordable and available than many people realize," said Robert Zirkelbach, AHIP's director of strategic communications. "But we also strongly believe that the individual health insurance market needs to be reformed—it is not working for everybody."

On Monday, the group launched a new advertisement that advocates for affordable health care for all Americans, regardless of preexisting conditions.

The Commonwealth Fund report also found that adults with individual health insurance coverage spend more out of pocket and on premiums than those with employer insurance. Approximately 64 percent of adults with individual coverage spend $3,000 or more per year on premiums while only 20 percent of those with employer plans spend that much, the report said. The report also found that adults with employer-based coverage spend $2,250 out of pocket on health expenses on average, including premiums, while those with individual insurance spend an average of $6,750. In all, more than half of adults with individual coverage spend 10 percent or more of their incomes on health care, the report said.

Nevertheless, the report also found that higher costs do not necessarily mean better coverage for those with individual health insurance plans. Approximately 20 percent of adults who purchased individual health insurance plans reported going without prescription drug coverage while 49 percent experienced limits on the total dollar amount their insurance will pay for health care, the report said. In addition, 41 percent of adults with individual insurance reported forgoing needed health care because of costs compared to 24 percent in 2001.

"People buying their own health insurance are paying significantly more in premiums than those with employer-based coverage, but are getting less for their money in terms of protection against high costs and access to the health care they need," study co-author and Commonwealth Fund Vice President Sara Collins said in a news release. "It is critical that health reform proposals set minimum benefit standards and provide adequate premium subsidies to ensure that families who lose their job-based benefits can purchase affordable coverage that gives them access to timely care and protects them from catastrophic health care costs."

Although adults with individual health insurance tend to pay more for coverage, the report found that those with employer-based plans also are confronted with increasing health care costs. In 2007, 31 percent of all privately-insured adults spend 10 percent or more of their income on out-of-pocket health care costs and premiums compared to 20 percent in 2001, the report said. Much of the increase stems from rising out-of-pocket costs in employer-based plans. Twenty-nine percent of adults with employer-based coverage spent 10 percent or more of their income on out-of-pocket costs and premiums in 2007, the report said, up from 18 percent in 2001.

To reverse these trends, the report says that the United States must make comprehensive health care overhaul a top priority.

"The time has never been more urgent for policy makers to forge consensus around strategies for reform that provide affordable and comprehensive coverage for all and apply the brakes to spiraling health care costs," the report concludes.

By Jane Norman, CQ HealthBeat Associate Editor

July 23, 2009 -- Democrats spread out in a health offensive Thursday in the wake of President Obama's health care press conference, as lawmakers revived their attacks on Republican ideas for a health overhaul, decried insurance industry practices, talked up the value of an independent commission to curb Medicare spending and brought in "real people" in to make the case for change.

It likely was a strong taste of what's to come during the long, hot weeks of August. Senate Majority Leader Harry Reid, D-Nev., said that Senate floor action on the overhaul will be delayed until senators return to work after Labor Day. The announcement wasn't much of a surprise, since Majority Whip Richard J. Durbin of Illinois had said the same on Wednesday night and the Senate Finance Committee has continued to meet for hours on end in negotiations aimed at finding a bipartisan compromise.

But it raised questions about how Democrats will continue to make their case with the American public over the summer recess, withstand criticism from Republicans and win over wavering members of their own party—all likely accompanied by a barrage of advertising from all sides in the debate. House Democrats also remained stalled on their march toward floor action by the end of the afternoon.

Reid said that Republicans working with Democrats on Finance had asked for more time, "so the decision was made to give them more time." He said he spoke with Finance Committee Chairman Max Baucus, D-Mont., who said he plans to mark up a bill prior to when the Senate leaves for its recess Aug. 7. It's better to have a product based on "quality and thoughtfulness," said Reid.

Though Democratic leaders for weeks have said they wanted floor debate on the health overhaul before the recess, "all of this is no big surprise," said Reid. He said the Finance Committee and Health, Education, Labor and Pensions Committee bills will be merged during the recess and the legislation will be ready for action when the Senate returns to Washington in September.

Other Democrats also downplayed fears that delay means failure. "The whole goal has always been to have the president sign it by the end of the year," said Sen. Charles Schumer, D-N.Y. "So the plan is going to be out there for a period of time. It's going to have to stand the test of the public as well...it's going to be out there for a significant period of time while the public reacts and maybe the plan is modified."

In Cleveland, at an appearance at the Cleveland Clinic promoting his health care plan, the president said of the Senate delay until fall: "That's OK." Meanwhile, two of his emissaries, Health and Human Services Secretary Kathleen Sebelius and Nancy-Ann DeParle, director of the White House Office of Health Reform, met over a lunch with Senate Democrats. Sebelius emerged to say that the overhaul "isn't about playing beat the clock but there's an urgency to health reform that deals with each and every American's life."

The desire to accommodate Republicans did not extend to the other chamber. Rep. Chris Van Hollen, D-Md., the chairman of the Democratic Congressional Campaign Committee, kicked off the day by slamming Republicans for failing to produce a complete health overhaul plan and for criticism of the cost of the Democrats' plans after the head of the Congressional Budget Office (CBO) said the House bill would do little to contain spending. "The president has made it clear we are going to respond to the issues the Congressional Budget Office raised on the spending side," said Van Hollen.

Separately, House Minority Leader John Boehner, R-Ohio, said Democrats have ignored all GOP ideas. "We outlined our bill over a month ago to the president and to our Democrat colleagues," said Boehner. "And unfortunately, they've taken very little of our ideas and incorporated them in their bill. But I hope—hope remains eternal. I happen to be an optimist, and I do believe at the end of the day if there's going to be a bill signed into law, it's going to have to be done with Democrats and Republicans working together in the best interests of the American people."

Van Hollen brushed aside questions as to whether Democrats are worried about GOP inroads in August. "The more the American people know the details of health care reform, the more they're going to see this is a good deal for the American people," he said.

House Speaker Nancy Pelosi declined to set a firm date for floor action in the House, and a top House Democrat, Majority Whip James E. Clyburn, D-S.C., said the House should not leave town until the bill is approved on the floor. The House is scheduled to begin its recess on July 31, a week before the Senate.

One idea that has continued to percolate in the wake of the CBO criticism is that of an independent commission similar to the Medicare Payment Advisory Commission (MedPAC), only with the power to enact curbs on Medicare spending. Office of Management and Budget Director Peter Orszag in a conference call with reporters said such a commission would "take the politics out of the process" and move Medicare to a more value-based system. The new commission also could tackle the sensitive issue of regional disparities in Medicare spending, he said, one of the issues that the fiscally conservative Blue Dog Democrats are pressing with House leaders.

Also on the revenue front, Sen. Thomas R. Carper, D-Del., a member of the Senate Finance Committee, said he continues to support the idea of taxing a portion of the most generous health insurance plans provided to employees, which has been touted by health care economists. "Is there some level, maybe $25,000 for a family? Most family health insurance is under $15,000," he said. He said Finance members also continue to explore the idea of taxing insurers on expensive plans but there may be problems with self-insured companies.

"It doesn't take but a couple of Republicans or Democrats to torpedo whatever plan we have," added Carper. "We are trying to find a consensus that will get 60 votes out here, on an issue where some of our Republican friends on the far right, they're not interested in solving a problem, they're interested in an issue. And they're putting huge pressure on the three Republicans—Sen. Grassley, Sen. Snowe and Sen. Enzi—not to be a part of this negotiation. Huge pressure." Republican Conference Chairman Lamar Alexander of Tennessee has denied that Republicans don't want these members—Finance Committee Republicans Charles E. Grassley, Olympia J. Snowe and Michael B. Enzi — negotiating.

Democrats sought to keep the focus on the need for a health care system that not only costs less but serves consumers better. Sen. Patty Murray, D-Wash., said she asked for stories from constituents about their problems with insurance and received 5,000 letters in return. "We know most Americans like their doctors, like their coverage today, think they have good insurance, and they're happy until payday," she said. "On payday they see more and more of their paycheck being taken away by increasing insurance premiums."

Thursday's health offensive also found members of the Congressional Black Caucus talking about health care and House Majority Leader Steny H. Hoyer, D-Md., bringing families to a press conference who had been denied insurance coverage because of pre-existing conditions. Reid's own press event featured a breast cancer survivor and a widow whose husband died at the age of 39 after years without insurance or regular preventive care. The White House had turned to new media, advertising a Facebook chat with DeParle, but it was postponed.

Through it all, Democrats maintained that they are ready to take their case to the people in August and can complete work on the overhaul. "I think we're on track," said Schumer. "No one wants delay but I think the president has done this just right. He keeps importuning us and moving us and pushing us forward, but not to the extent you don't have the best product possible."

By Alex Wayne, CQ Staff

July 20, 2009 -- House Democratic leaders are showing cold feet on a plan to tax the wealthy to finance a health care overhaul and may rewrite the legislation to seek more savings from payment changes in Medicare and Medicaid.

The bill's surtax on high earners, meanwhile, could be adjusted so that it is only implemented if expected savings don't materialize, the No. 3 House Democratic leader said Monday on MSNBC's "Morning Joe.

"I don't think we have to have the surcharge at all. There are a lot of Democrats on my side of the aisle believe that," James E. Clyburn, D-S.C., said. He added that "because we think there is a chance that some funding may need to come far down the road, we could have this trigger in here" for a surcharge on the wealthy, "a trigger which we don't think ever will need to be pulled. And so, that's what we've been working on."

That pronouncement brought jibes from Michael Steel, a spokesman for House Minority Leader John A. Boehner, R-Ohio. "With two weeks to go before their self-imposed deadline for passing a bill that will radically alter nearly 20 percent of the American economy, maybe House Democratic leaders should get on the same page," he said.

The Ways and Means Committee, which shares jurisdiction over the health bill (HR 3200) with two other House panels, approved a surtax on the adjusted gross income of upper-income Americans designed to raise $544 billion over a decade, with a top rate of 5.4 percent for individuals making $800,000 and married couples making $1 million. The surtax would affect the top 1.2 percent of taxpayers.

Clyburn, like other Democratic leaders, complained that the Congressional Budget Office is not giving official credit to savings that the bill's supporters say would occur as a result of provisions designed to promote wellness and avoid expensive medical treatments.

"You know, CBO is not scoring a big part of this bill on the savings side...And we believe that the savings are in the system. We don't need to have any kind of new monies coming into the system if we were to score these savings," he told MSNBC.

Clyburn said House Democrats are prepared to push forward with a bill before the August recess no matter what CBO says in its formal scoring.

"We've had six listening sessions of our members. And we have come away from those sessions believing that we can do this with the savings that we will get out of the [health care] system. If we don't get the scoring from CBO, we can still go ahead and do the plan as we envision the savings to be," he said.

President Obama, speaking briefly after an event at the Children's National Medical Center in Washington, tried to rebuild momentum lost over the past week as lawmakers struggled with the CBO's assessment that the current proposals would increase health cost, not reduce them, over the long term and would not be deficit neutral within the 10-year budget scoring period.

"The need for reform is urgent, and it is indisputable," Obama said.

"We can and we must make all these reforms, and we can do it in a way that does not add to our deficits over the next decade," he insisted. He urged lawmakers to "fight our way through the politics of the moment" and keep on track to enact a health overhaul by year's end.

The House Energy and Commerce Committee was set to resume marking up its section of the House bill at 4 p.m., while talks continued on the Senate side among members of the Finance Committee.

By Bart Jansen and Alex Wayne, CQ Staff

July 23, 2009 -- Senate Majority Leader Harry Reid said Thursday the Senate will wait until September to take up a health care overhaul, but the Finance Committee will vote before the August recess.

Reid said he would oversee blending the Finance version with the bill approved July 15 by the Health, Education, Labor, and Pensions (HELP) Committee on a party-line vote.

Finance Chairman Max Baucus, D-Mont., said Thursday he hopes to mark up a health care overhaul the week of Aug. 3; the Senate leaves for its summer recess Aug. 7.

Reid said ongoing talks with ranking Finance Committee Republican Charles E. Grassley of Iowa and two other panel Republicans, Olympia J. Snowe of Maine and Michael B. Enzi of Wyoming, were productive and would lead toward Senate approval of the combined legislation with at least the 60 votes needed to overcome procedural challenges.

"It's a complex, difficult issue," Reid said. "I think it's better to have a product that is one based on quality and thoughtfulness rather than pushing something through."

Although President Obama had pressed Democratic leaders to pass a health bill through both chambers before the recess, he backed off that demand this week. And on Thursday, Health, and Human Services Secretary Kathleen Sebelius, after meeting with the Senate Democratic Policy Committee, said, "This is not about playing beat the clock."

Other Democrats professed no concern about the delay.

"I think it's probably a good thing," said Sen. Claire McCaskill, D-Mo., a centrist. "I think it's important I read the whole bill, go home and talk to my constituents about it, and then come back prepared to vote."

She said she wasn't worried that opponents of the bill might use the recess to their advantage. "I think there's a huge amount of support for change. But there's also fear about change. So I think time can alleviate that fear."

Sen. Shelden Whitehouse, D-R.I., said an August filled with ad campaigns and lobbying by opponents was to be expected regardless.

"That would've been the case either way," he said. "August was always out there for the naysayers to drum up opposition."

Controlling Costs

One of the contentious proposals the Finance Committee negotiators are considering would strengthen the Medicare Payment Advisory Commission, which recommends changes in government reimbursements to health care providers participating in the huge insurance program for the elderly and disabled.

The White House is backing a proposal to have Congress vote on the commission's recommendations up or down, without amendments, as it does on the recommendations of an independent military base closing commission.

Currently, MedPAC's recommendations are often ignored or watered down as affected provider groups furiously lobby lawmakers to preserve their funding.

"There will be some sort of version of it," Reid said.

Reid said he would work to combine the HELP and Finance bills, using as a vehicle an unrelated revenue measure from the House.

"This is not something I'm going to do in a dictatorial fashion," Reid said. "I'll work with the White House. I'll work with the entire Democratic Caucus. We'll work with Republicans. It will be something that gets 60 votes."

Reid said the ultimate goal is to clear health legislation before the end of the year.

"All of this should not come as a surprise to people," Reid said. "What we're going to do is come back in the fall.''

Finance Talks

Baucus made it clear to Democrats in the bipartisan group of panel members who have been working on a draft bill that any proposal they come up with "is just that, just a proposal," and not a final product.

He told reporters he had promised to vet whatever the small negotiating team produces with the committee's Democrats and then take any changes back to the group before a formal markup.

Meanwhile, nine freshman Democrats urged Baucus to keep working to produce a bipartisan overhaul that will contain costs over the long term.

In a letter to Baucus, the senators—crucial to the Democrats' ability to advance any health overhaul—said, "We all believe that increasing coverage, improving quality of care, and reining in annual health care cost increases are vital goals. In the face of exploding debt and deficits, however, we are concerned that too little focus has been given to the need for cost containment.

"The fact is that the current situation is unsustainable in the long term. With 17 percent of our GDP currently being used to pay for health care services, we must get health care costs under control so we can compete and lead in the global marketplace. We believe that any final bill must include innovation, hard decisions, and incentives to bend the cost curve."

The letter was signed by the seven Democrats first elected in 2008 and by two others appointed this year—Roland W. Burris of Illinois and Michael F. Bennet of Colorado. The only new Democratic senator missing from the list was Kirsten Gillibrand of New York.

The group promised to "help you and the Senate Finance Committee to craft a bill that bends the health care cost curve, provides affordable coverage, and rewards value-added services."