WASHINGTON — In a last effort to give the Senate a bipartisan health care bill, the chairman of the Senate Finance Committee circulated a comprehensive proposal on Sunday to overhaul the health care system and proposed a new fee on insurance companies to help pay for coverage of the uninsured.
The proposal is the culmination of more than a year of work by the chairman, Senator Max Baucus, Democrat of Montana. A similar fee was proposed by several liberal Democrats in July. In making it part of his proposal, Mr. Baucus may help cover the costs of the bill but also risks alienating Republicans whom he is trying to win over. Mr. Baucus is struggling to forge a bipartisan consensus among 6 of the 23 senators on his committee before President Obama puts new pressure on lawmakers in an address to a joint session of Congress on Wednesday evening.
The proposal by Mr. Baucus does not include a public option, or a government-run insurance plan, to compete with private insurers, as many Democrats want.
The White House press secretary, Robert Gibbs, appearing Sunday on the ABC News program “This Week,” said Mr. Obama saw the public plan as “a valuable tool” to promote choice and competition in the insurance market. But he stopped short of saying that the president would veto a bill without it.
It remains to be seen how Mr. Baucus’s plan might mesh with any proposals Mr. Obama lays out as he tries to pump up support for health care legislation, his top domestic priority.
People familiar with Mr. Baucus’s plan said it was calculated to appeal to Senator Olympia J. Snowe, Republican of Maine. But, at first glance, they said, it appears unlikely that the proposal, in its current form, could win support from the other Republicans in the “group of six,” Senators Charles E. Grassley of Iowa and Michael B. Enzi of Wyoming.
The group is scheduled to meet on Tuesday, when Congress reconvenes after its August recess. Mr. Baucus is looking for a quick response from the Republicans.
Mr. Baucus’s plan, expected to cost $850 billion to $900 billion over 10 years, would tax insurance companies on their most expensive health care policies. The hope is that employers would buy cheaper, less generous coverage for employees, thereby reducing the overuse of medical services.
The separate new fee on insurance companies would help raise money to pay for the plan. The fee would raise $6 billion a year starting in 2010, and it would be allocated among insurance companies according to their market shares.
The fees were first proposed by Senators Charles E. Schumer of New York, John D. Rockefeller IV of West Virginia and Debbie Stabenow of Michigan. Until now, Mr. Baucus had not shown interest in the idea.
Mr. Schumer said, “The health insurance industry should pay its fair share of the cost because it stands to gain over 40 million new consumers under health care reform legislation.”
Mr. Rockefeller said the fees were justified because insurance companies were “rapaciously, greedily and unstoppably making money by underpaying the patient, by underpaying the provider and by overpaying themselves.”
Insurers and many Republicans in Congress oppose the fees, saying they would be passed on to families and employers who buy insurance. Robert E. Zirkelbach, a spokesman for America’s Health Insurance Plans, a trade group, said the fees would “make coverage less affordable.”
A recent report by Oppenheimer & Company, the investment bank, said, “It will be very difficult for the Senate Finance Committee to structure the fees in a way that they won’t be immediately passed on to customers in the form of higher premiums.”
Another section of Mr. Baucus’s proposal would help pay insurance premiums, co-payments and deductibles for people with incomes less than 300 percent of the poverty level ($66,150 for a family of four). It would also provide some protection for people with incomes from 300 percent to 400 percent of the poverty level (up to $88,200 for a family of four), so they would generally not have to pay more than 13 percent of their income in premiums.
Mr. Baucus’s proposal does not include a “trigger mechanism” of the type recommended by Ms. Snowe, who would offer a public insurance plan in any state where fewer than 95 percent of the people had access to affordable coverage.
Senator Ben Nelson, Democrat of Nebraska, expressed support for Ms. Snowe’s idea on Sunday. On the CNN program “State of the Union,” he said Mr. Obama ought to say that “if there’s going to be a public option, it has to be subject to a trigger.”
“In other words,” Mr. Nelson said, “if somehow the private market doesn’t respond the way that it’s supposed to, then it would trigger a public option or a government-run option, but only as a fail-safe backstop to the process.”
Coverage under Mr. Baucus’s plan would, by some measures, be less extensive than the least generous of three levels envisioned in a bill approved by three House committees.
To compare health plans, experts often focus on the percentage of medical expenses paid by insurance, on average, for a given population. This figure ranges from 70 percent to 95 percent under the House bill’s options, but it would be less than 70 percent under Mr. Baucus’s proposal.
Mr. Baucus would impose limits on out-of-pocket medical costs — the co-payments, deductibles and similar charges for covered items and services. The limits would be $11,900 a year for a family and $5,950 for an individual. The comparable numbers in the House bill are $10,000 and $5,000.