AP sources: Senate group omits employer mandate

A bipartisan group of senators is closing in on a health care compromise that omits key Democratic priorities but seeks to hold down costs, as lawmakers on both sides of the Capitol labor to deliver sweeping health legislation to President Barack Obama.

After weeks of secretive talks, three Democrats and three Republicans on the Senate Finance Committee were edging closer to a compromise that excludes a requirement many congressional Democrats seek for large businesses to offer coverage to their workers. Nor would there be a provision for a government insurance option, despite Obama's support for such a plan, officials said.

The Finance senators were considering a tax of as much as 35 percent on very high-cost insurance policies, part of an attempt to rein in rapid escalation of costs. Also likely to be included in any deal was creation of a commission charged with slowing the growth of Medicare.

"We're going to get agreement here," Sen. Max Baucus, D-Mont., the Finance Committee chairman, said Monday. "The group of six really wants to get to 'yes.'"

Obama has outlined two broad goals for legislation he is struggling to win from Congress: expansion of health insurance coverage to millions who lack it, and reining in increases in costs. The president is participating in an AARP town-hall meeting on health care Tuesday.

The president's top domestic priority has suffered numerous setbacks in recent weeks and a Senate vote has been postponed until September. Administration and Democratic leaders hope to show significant progress before lawmakers begin their monthlong August recess.

In the House, the Democratic leadership sought to allay concerns among the rank and file, holding a five-hour briefing on the House version of the legislation, which was written without Republican support. Democratic leaders are still holding out hope of floor passage before the summer break, and Majority Leader Steny Hoyer is looking at keeping the House in session some days past its scheduled Friday adjournment date.

A group of seven fiscally conservative House Democrats who have held up action in the Energy and Commerce Committee by demanding more cost savings and other changes negotiated late into the night Monday with the committee's chairman, Rep. Henry Waxman, D-Calif. Waxman's is the only one of three House panels with jurisdiction on the health bill that has yet to act.

Waxman made the so-called Blue Dog Democrats an offer intended to address their concerns, and they planned to meet Tuesday to decide how to answer, they said. Neither Waxman nor the leader of the rebel Democrats, Rep. Mike Ross, D-Ark., would give details on the offer. They said it touched on the 10 items in a list of demands the Blue Dogs have given Waxman, including increasing an exemption for small businesses from a requirement to provide insurance coverage, and decreasing the size of subsidies offered to poor people to help them buy care.

"We're going to review it and decide whether we feel it's something that we can accept, or whether we want to counter, or whether we believe that we should simply keep talking," Ross said.

The Blue Dogs have enough votes in the Energy and Commerce Committee to potentially block passage there, but time is running out for their negotiations with Waxman. The talks nearly broke down Friday after Waxman threatened to bypass his own committee and move the health bill straight to the floor, circumventing the Blue Dogs.

A voting session in Waxman's committee that has been on hold for a week must resume quickly, probably by Wednesday at latest, if there's any chance for the committee to pass a bill and send it to the full House for action before the summer recess. Bypassing the committee remains a last-ditch option if agreement can't be reached.

"If we're going to do the bill out of committee, this is the week," Waxman said.

In the Senate, officials stressed that no agreement has been reached on a bipartisan measure, and said there is no guarantee of one, with numerous key issues remaining to be settled.

The officials spoke on condition of anonymity, saying they were not authorized to discuss matters under private negotiations.

They said any legislation that emerges from the talks is expected to provide for a nonprofit cooperative to sell insurance in competition with private industry, rather than giving the federal government a role in the marketplace.

Obama and numerous Democrats in Congress have called for a government option to provide competition to private companies and hold down costs, and the House bill includes one - another concern for the Blue Dogs. But one of the senators involved in the talks, Olympia Snowe, R-Maine, confirmed that co-ops are the preferred approach of the Senate Finance Committee negotiators.

Officials also said a bipartisan compromise in the Senate would not subject large companies to a penalty if they declined to offer coverage to their workers. Instead, these businesses would be required to reimburse the government for part or all of any federal subsidies designed to help lower-income employees obtain insurance on their own.

The legislation in the House includes both a penalty and a requirement for large companies to share in the cost of covering employees.

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Associated Press writer Ricardo Alonso-Zaldivar contributed to this report.