WASHINGTON (AP) - The White House, Democratic leaders and four fiscally conservative House lawmakers worked out a deal Wednesday to move ahead on sweeping health care legislation.
The agreement would allow a committee vote, preserving momentum on President Barack Obama's top domestic priority.
The deal calls for exempting more small businesses from a requirement to offer coverage, trimming subsidies to help people buy health insurance, and making any government-sponsored insurance plan negotiate payment rates with medical providers - instead of dictating them.
The House Energy and Commerce Committee planned to begin work on the bill Thursday. Amendments to the legislation would include provisions of the deal. The committee is the last of three in the House to act on the legislation, and Chairman Henry Waxman, D-Calif., hoped to finish by Friday when lawmakers leave for their monthlong August recess.
The House has put off a vote on the overall legislation until September.
The deal gave momentum to the push for health care heading into the August recess, while saving face for all sides in the intraparty Democratic dispute over the legislation's size and scope.
The White House, Speaker Nancy Pelosi, D-Calif., and Waxman praised the progress. The conservative to moderate Blue Dogs head home without being blamed by liberals for derailing the effort. However, there was immediate backlash from House liberals to some provisions of the deal - particularly the reduction in subsidies and the change to the government-sponsored insurance plan.
"The question is have we given up too much," said Rep. Eliot Engel, D-N.Y., a member of the Energy and Commerce Committee.
Presuming Waxman gets the bill through his committee, all sides will have the summer to rethink their positions and plan for September. New cost estimates by the Congressional Budget Office, lobbying by all sides on the issue and public opinion could change minds by the time lawmakers return.
The Blue Dogs did not commit themselves to doing anything when the full House votes in several weeks. They could support the bill or, once again, oppose it en masse and hold it hostage to new demands.
Pelosi will face one of the summer's bigger challenges. She will have to figure out how to find enough votes from liberal and moderate Democrats while weaving a single bill out of the three measures approved by the Energy and Commerce, Ways and Means, and Education and Labor committees.
The leader of the Blue Dogs, Rep. Mike Ross, D-Ark., said the deal included:
-Exempting businesses with payrolls of up to $500,000 from a requirement to provide insurance to employees or pay a penalty. The existing bill had set the level at $250,000.
The penalty would hit businesses with payrolls between $500,000 and $750,000 on a sliding scale before kicking in fully at 8 percent of payroll.
-Poor people would get subsidies to help them buy care after spending 12 percent of their income on premiums, instead of 11 percent in the existing bill.
-Payment rates to doctors and other medical providers in a new public insurance plan would be negotiated with the secretary of Health and Human Services, instead of tied to Medicare rates as the bill now says. The Blue Dogs contend that change will lead to fairer payment rates.
-In addition to the public plan, states will have the option of setting up health care co-ops. Details on that were still being worked out.
-Instead of the federal government picking up the full cost of an expansion of Medicaid, states would pick up part of the costs.
Ross said that together the changes would cut costs in the $1.5 trillion bill by about $100 billion, though the new break for small businesses and the decision to allow negotiated rates in the public plan would also add significant costs, so it wasn't clear that there was any net cost savings from the deal.
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Associated Press writer Alan Fram contributed to this report.