House Democrats unveil $1.5 trillion health plan

WASHINGTON - House Democrats unveiled ambitious legislation yesterday to remake the nation's health-care system and called on medical providers, businesses, and the wealthiest Americans to pick up the tab - an estimated $1.5 trillion over 10 years - for President Obama's top domestic priority.

"This bill is a starting point and a path to success," House Speaker Nancy Pelosi told a news conference where she and other Democratic leaders promised to pass a bill before the August congressional recess.

Obama has pushed the House and Senate aggressively to stick to the timetable, in hopes of signing comprehensive legislation in October.

"We are going to accomplish what many people felt wouldn't happen in our lifetime," said Rep. Henry A. Waxman (D., Calif.), chairman of one of three committees responsible for health care.

The sweeping measure would impose penalties on employers who fail to provide health insurance for their workers and on individuals who refuse to buy it.

The bill, to be debated in committee starting this week, also would require insurance companies to offer coverage, without exceptions or higher premiums in cases of preexisting medical conditions.

It also would allow the government to sell insurance in competition with private firms, sparking objections from Republicans and some Democrats.

The bill's release came one day after Obama met with key Democrats in a White House session in which he told Senate Finance Committee Chairman Max Baucus (D., Mont.) he wants legislation by week's end in his committee.

In a statement, Obama praised the proposal, saying it "will begin the process of fixing what's broken about our health care system, reducing costs for all, building on what works and covering an estimated 97 percent of all Americans."

The legislation includes federal subsidies for poorer individuals and families to help them afford coverage.

Financing would come from a federal surtax on the upper income - up to 5.4 percent on the income of taxpayers making more than $1 million a year - as well as hundreds of billions of dollars in cuts in projected Medicare and Medicaid spending.

The new income tax on the wealthy is estimated to raise $500 billion over the next decade, and reductions in Medicaid and Medicare would account for nearly as much.

The plan lacked figures on total costs, but a House Democratic aide, speaking on condition of anonymity to discuss private calculations, estimated the total bill would add up to $1.5 trillion over 10 years.

Employers who do not offer coverage would be required to pay 8 percent of each uninsured worker's salary, with exemptions for smaller firms built into the legislation.

Individuals who refused to buy affordable coverage would be assessed as much as 2.5 percent of their adjusted gross income, up to the cost of an average health-insurance plan, according to the legislation.

As House leaders unveiled their bill, the business community sent a letter to lawmakers charging that parts of the legislation would damage the country's medical system and economy.

Thirty-one major business groups signed the letter, including the U.S. Chamber of Commerce, the Business Roundtable representing top corporate CEOs, and the National Retail Federation.

Across the Capitol, the Senate Health, Education, Labor and Pensions Committee slogged toward passage of its version of the bill. The Senate Finance Committee retains control over the drafting of provisions paying for any legislation.