Stage set for health battle in Senate

WASHINGTON — Senate Democratic leaders Wednesday unveiled an $849 billion plan to overhaul the nation's health-care system, a proposal likely to trigger an epic Senate battle over how consumers will buy and maintain coverage.

The Senate could vote as early as Saturday to begin debate on the measure, which would require most people to obtain insurance and would create a government-run insurance plan, or public option, starting in 2014, in which states could choose to not participate.

The nonpartisan Congressional Budget Office (CBO) estimates the plan should shave $127 billion from the federal deficit over 10 years, the biggest projected savings of any major health-care bill thus far.

It would bar insurers from denying coverage because of pre-existing conditions and set up exchanges, or marketplaces, where consumers could easily compare coverage and rates, and provide federal help for lower-income people to obtain policies.

Getting the 2,074-page bill approved promises to be a lengthy, arduous struggle, but an unusually optimistic Senate Majority Leader Harry Reid, D-Nev., said Wednesday, "tonight begins the last leg of this journey we've been on for some time ... the finish line is finally in sight."

In a last touch Wednesday, Reid and his aides named the bill: the Patient Protection and Affordable Care Act.

Without any GOP support, all 58 Democrats and the two independents who caucus with them must hold together to get the required 60-vote supermajority necessary to move forward on any health legislation. Senate leaders said they're confident they will get the votes to proceed after talking with three wavering moderates, Arkansas' Blanche Lincoln, Louisiana's Mary Landrieu and Nebraska's Ben Nelson.

Nelson said that while he remained undecided, the possible Saturday vote shouldn't be seen as a judgment on the bill's substance. "It is a motion to start debate on a bill and to try to improve it," he said.

Other moderates were also cautious. "We'll wait and see," Lincoln said. Added Sen. Evan Bayh, D-Ind., "I'm going to reserve judgment until I've had a chance to read it, but the numbers on deficit reduction are encouraging."

Republicans, who have bitterly opposed similar initiatives, vowed to fight:

"It's going to be a holy war," said Sen. Orrin Hatch, R-Utah, who is one of his party's most respected voices on health policy but for the past several months has voiced nothing but fury over the Democrats' efforts.

Senate Minority Leader Mitch McConnell of Kentucky called it "yet another trillion-dollar experiment," and vowed "this will not be a short debate."

Liberals were ecstatic, though. The cost estimate was within President Obama's goal of $900 billion, and the bill would lower the number of uninsured by 31 million.

The long-awaited bill differs from the version passed in the House on Nov. 7 in at least three crucial ways.

• First, its government plan would permit states to "opt out," whereas the House doesn't, though the CBO preliminary analysis still figures 94 percent of eligible Americans would be covered, compared with the current 83 percent. The House bill would result in coverage for an estimated 96 percent.

• Second, the Senate measure would raise funds with a variety of taxes, notably a tax on more expensive "Cadillac" insurance policies — $8,500 on policies for singles and $23,000 for families — and a 0.5 percentage point boost, to 1.95 percent, in the Medicare payroll tax for singles with adjusted gross incomes of more than $200,000, and families earning more than $250,000.

Congress' Joint Committee on Taxation estimated the high-end insurance tax would raise $149.1 billion over 10 years, while the Medicare tax increase would raise $53.8 billion.

Neither provision is in the House bill, which would instead impose an income-tax surcharge on the wealthy.

• Third, the Senate bill has less restrictive language than the House on abortion, which is sure to trigger a fight.

If the Senate moves ahead with consideration of the bill, the debate is expected to last until a holiday recess in late December and perhaps continue into January. If the Senate passes a bill, it would need to be reconciled with the House version. A negotiating committee of both chambers' leaders would craft the compromise, and that would be subject to both chambers' approval.

A key test of the bill's strength is likely to involve abortion. Anti-abortion Democrats nearly derailed the House bill this month, until they got a last-minute concession that bars federal money from paying for abortions except in cases of rape or incest or where a woman's life is in danger. Hatch said Wednesday he expects to propose language similar to that adopted in the House.

Reid's bill seeks to extend current law by barring the use of federal money for abortions. But it would also require that at least one insurance plan that covers abortion and one that does not cover abortion be offered in every state.

Reid's bill also would create a voluntary federal program to provide long-term-care insurance and cash benefits to people with severe disabilities. The program, Community Living Assistance Services and Supports, would be financed with premiums.

Under the plan, participating employers would let workers pay premiums into the program, which would offer a cash benefit of between $50 and $75 a day for adult day care or assisted-living expenses. Workers would pay into the plan for five years before receiving benefits.

The House-passed bill includes similar provisions.

Material from The New York Times, Bloomberg News and the Tribune Washington Bureau is included in this report.