Democrats push for Sunday health care vote

WASHINGTON — Pushing toward a Sunday vote that could transform the nation's health-insurance system, House leaders announced a $940 billion compromise Thursday that would extend coverage to the vast majority of Americans, cut billions of dollars from Medicare, and impose new taxes on the wealthy and the well-insured.

The package received a major boost Thursday when the nonpartisan Congressional Budget Office projected that it would reduce deficits by about $138 billion over the next 10 years and by about $1.2 trillion in the decade thereafter.

Republicans quickly noted that those numbers represent a tiny fraction of the huge deficits projected for that period. But House Speaker Nancy Pelosi, D-Calif., was jubilant, calling the bill "a triumph for the American people in terms of deficit-reduction."

Pelosi's lieutenants held out hope that the numbers would sway fiscal conservatives, who formed the largest bloc of "no" votes when the House passed a more costly health-care bill in November.

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The proposal, a rewrite of a slightly narrower health-care bill the Senate passed on Christmas Eve, also significantly would expand the federal student loan program, offering President Barack Obama the prospect of victory on two of his most important domestic initiatives after a year of legislative stalemate.

The stakes are so high and the outcome so uncertain that Obama canceled a trip to Indonesia and Australia to continue lobbying undecided lawmakers with phone calls and invitations to White House meetings.

House Democratic leaders hope to approve the Senate bill along with a separate, 153-page package of revisions to that bill that House members are demanding.

The compromise would extend coverage to an additional 32 million Americans over the next decade by expanding Medicaid eligibility and creating state-run insurance exchanges and federal subsidies for lower-income families who lack access to employer-provided coverage.

All Americans would be required for the first time to obtain insurance or face an annual penalty of $695; employers could face penalties of $2,000 per worker for not offering affordable coverage.

In exchange for the new business, private insurers would be subject to an array of rules, including a ban on the practice of denying coverage to people with preexisting medical conditions and a requirement that adult children be permitted to stay on their parents' policies until age 26.

Compared with the Senate bill, the compromise would offer more generous tax credits to people who may otherwise be unable to afford insurance, and would fully close the "doughnut hole," a gap in the Medicare prescription-drug program that is costly for many senior citizens, beginning with a $250 rebate for those affected this year.

It would eliminate the most politically contentious of several deals cut to win the votes of recalcitrant lawmakers by extending to all states a promise of Medicaid funding that had originally been offered only to Nebraska.

And it would delay until 2018 the implementation of a 40-percent tax on high-cost insurance policies.

To cover the cost of those changes, the compromise would impose a 3.8 percent Medicare tax on investment income for wealthy taxpayers, a levy that would come in addition to a Senate-proposed increase in the regular payroll tax for those families.

And it would slice an additional $60 billion from Medicare, bringing the total reduction in projected spending on the program to more than $500 billion over the next decade.

Republicans remained unified in their opposition to the legislation, vowing to block a bill they condemn as a dangerous and budget-busting intrusion into the private health-care system.

As House Republicans angled to prevent passage in the anticipated Sunday vote, Senate Republicans laid procedural traps for the package of revisions.