Senate healthcare bill on track for public release

Senate Finance Committee Chairman Max Baucus leaves the Senate's ''Gang of Six'' meeting on health care reform on Capitol Hill, September 14, 2009.

WASHINGTON (Reuters) - Bipartisan negotiators on the U.S. Senate Finance Committee worked to pare down the costs of a broad healthcare overhaul on Monday, and chairman Max Baucus said he was still on track to produce a bill this week.

The latest Congressional Budget Office estimate put the cost at $880 billion over 10 years, less than earlier estimates, and Baucus said he still hoped to win Republican support for President Barack Obama's top domestic priority.

"We are working to bring this process to closure over the next week or so," he told reporters after a meeting of the so-called "Gang of Six" negotiators -- three Republicans and three Democrats who have been meeting for months on the bill.

The committee's eventual bill is expected to form the backbone of any ultimate congressional compromise and is likely to be similar to many of the proposals Obama laid out in his healthcare speech last week.

Baucus said he still expected to release his proposal on Tuesday and the committee will vote on it next week with or without Republican support.

Obama says the overhaul of the $2.5 trillion healthcare industry should cut costs, improve care, regulate insurers to protect consumers and expand coverage to many of the 46 million Americans without any health insurance.

Senator Olympia Snowe of Maine, one of three Republican negotiators and the focus of Democratic hopes for support, said she was not prepared yet to back the legislation.

"We can't say that yet. We're still working through a number of issues and there are others remaining," she told reporters. The group plans to meet again in the afternoon.

Three House of Representatives committees and one Senate committee have finished work on a healthcare bill, leaving the Senate Finance panel as the final hurdle before each chamber takes up the issue.

Negotiators on Monday focused on Medicaid -- the federal healthcare program for the poor -- medical malpractice and immigration issues. Baucus said the plan's expansion of Medicaid would cost states less than they expected.

"States are going to be pleasantly surprised that they will have some additional costs but much less than they originally thought," he said.

CO-OPS, NOT GOVERNMENT-RUN OPTION

The Baucus plan would create nonprofit cooperatives to compete with insurance companies instead of a government-run insurance plan -- the "public option" -- sought by liberal Democrats and backed by Obama.

The public option has come under fire from critics concerned it would hurt insurance companies and give government too broad a role, but many liberal House Democrats say it will foster increased competition and they will not support a plan without it.

While Obama backs a government-run option, he has signaled it is not essential to help meet his goal of expanding coverage to the uninsured.

The Baucus plan under discussion by negotiators would tax insurance companies on their most expensive healthcare policies and levy a fee on companies that would raise about $6 billion a year to help pay for the plan.

It also would offer tax credits on a sliding scale for individuals and families starting in 2013 to offset the cost of private plan premiums, and would provide tax credits to small business.

In addition, it proposes to limit out-of-pocket expenses for patients, bar insurers from placing caps on benefits and expand the government-run Medicaid program for the poor.

Democrats have been pushing Baucus to move forward even if he cannot win over any of the three Republican negotiators -- Snowe, Charles Grassley and Mike Enzi.

Enzi and Grassley were critical of Obama's plans during the August recess, dimming hopes they would be included in an ultimate compromise and prompting the White House and other Democrats to focus on Snowe as a possible partner.

(Editing by David Alexander and Jackie Frank)