Obama urges Senate Democrats to settle healthcare issues

The president said passing a healthcare bill is "not a luxury" and said the time between now and Congress's August recess, the deadline House and Senate leaders have set for floor votes, will be the "make-or-break period."

But in the last several days, differences have emerged between the two main architects of the healthcare legislation in the Senate, Edward M. Kennedy of Massachusetts and Max Baucus of Montana.

Kennedy, chairman of the Health, Education, Labor, and Pensions Committee, is leaning toward creating a widely available Medicare-style public insurance option. But Baucus, the Finance Committee chairman, strongly favors a bipartisan solution - and Republicans consider Kennedy's public plan an intolerable threat to the private insurance industry.

The White House and Baucus have also disagreed how the bill should be financed. Baucus wants to tax a portion of healthcare benefits provided by employers - an approach Obama campaigned against. After meeting with Obama, Baucus told reporters the president suggested he was open to reconsidering - but the White House later said he was not.

Kennedy did not attend the White House meeting, and he was absent from his committee's first closed-door meeting to begin the final stages of constructing a health bill - its most important task in years. An aide to Kennedy, who is battling brain cancer, said the senator spoke to the president yesterday morning. "Senator Kennedy is doing a good job at balancing his work on health care reform with his treatment plan, but he's not planning to be back on the Hill this week," spokesman Anthony Coley said in an e-mail.

In a reminder of the ideological divide between the Democrats and the business community, which so far has expressed support for a health overhaul, the US Chamber of Commerce issued a statement opposing some of the key ideas the Democrats are discussing, including a requirement that all employers provide insurance, the establishment of a public plan, and regulations that would require all insurance policies to include generous benefits, which the chamber said would be unaffordable.

Still, Baucus said he remained optimistic that his and Kennedy's committees could forge a single compromise bill, to be voted on by the full Senate before the monthlong August recess.

"We agree that our bills should be fairly, if not very, closely aligned, and we're going to reach agreement and have one bill before we go forward," he said, also reiterating the bill must ultimately win bipartisan support to succeed.

After news reports of dissension last weekend, Kennedy also joined Baucus in a statement pledging to work together.

It's difficult to see a clear path to such a bipartisan deal, though.

Liberal Democrats insist that a government-backed insurance option is essential to lowering health costs and giving people a choice in healthcare. At a news conference Monday, leaders of the largest left-wing groups in the country announced they were prepared to spend $82 million to build support for a public insurance option.

But Republicans and some Democratic moderates fear a government-backed public option would devastate the private insurance industry, and yesterday Senator Kent Conrad, a North Dakota Democrat and chair of the Senate Budget Committee, said the party's left wing must come to grips with political reality. "At the end of the day if we want to achieve something we're going to have to understand we don't any of us get precisely what we might like," he said.

Senator Judd Gregg, a New Hampshire Republican, called the draft proposal being circulated by Kennedy's committee "very discouraging," little more than a collection of "old ideas that have been around for a long time on the left," including a Medicare-style public plan, a broad expansion of Medicaid, and an employer mandate.

But he also said he agreed with the White House that major health changes are essential to economic progress.

Senator Charles Schumer, a New York Democrat, has offered a compromise on a public insurance option, proposing that any such plan be required to abide by the same regulations as private plans, be financially self-sufficient and not rely on taxpayers, that it pay doctors and hospitals more than Medicare, that providers not be required to participate as a condition of accepting Medicare, and that the insurance market be regulated by a different body than the one governing the public plan.