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House Democrats Unveil $894B Health Reform Bill

BY Lea Winerman  October 29, 2009 at 1:37 PM EST

House Speaker Nancy Pelosi unveils health care reform legislation; Getty Images

The legislation is a combination of versions passed by three House committees earlier this year. It would significantly expand Medicaid, the government-funded insurance program for the poor, and would provide subsidies to help lower and moderate-income Americans buy health insurance from either private insurers or a new government-run public plan.

Read the highlights of the House plan here.

In a decision designed to appeal to conservative and centrist Democrats, the federal officials who administer the public plan would negotiate payment rates with doctors and hospitals, rather than using rates tied to Medicare reimbursement.

“This is a historic moment for our nation and families,” Pelosi said at a rally to unveil the bill. “For nearly a century, leaders of every party and political philosophy have fought for health insurance reform.”

In a piece of showmanship designed to underline that point, Rep. John Dingell, D-Mich., spoke at the rally while holding the gavel he used to preside over the House when it passed Medicare in 1965.

“I’m going to lend it to whoever gets to preside over this legislation,” he said, “because a good piece of wood doesn’t wear out with one great event.”

Listen to the full rally:

Speaker Pelosi’s office said in a statement that the bill would reduce the federal deficit by $30 billion over the next decade. It would be paid for through savings in Medicare and Medicaid — Medicare expenditures would drop by 1.3 percent annually, according to the Speaker’s office — and by a tax surcharge on Americans who make more than $500,000 per year, or couples who make more than $1 million.

In its broad outlines the bill has many similarities with the measure that Senate Majority Leader Harry Reid is now working on — a combination of two bills passed by Senate committees.

Both would include some kind of individual mandate that would require most Americans to buy insurance coverage, and would provide some levels of subsidies to do so. Both would also impose new restrictions on the insurance industry, such as a ban on turning away customers due to pre-existing conditions and a ban on annual or lifetime benefit caps.

But there are many differences as well. The Senate bill, for example, will likely raise funds through a tax on expensive, so-called “Cadillac” insurance plans.

The White House released a statement praising the legislation.

“I congratulate the House of Representatives on the introduction of the Affordable Health Care for America Act, another critical milestone in the effort to reform our health care system,” President Obama said in the statement, adding that the legislation passed the critical test of not adding to the federal budget deficit.

But reaction from Republicans was also quick.

“The lasting image coming out of today’s press conference is one of dozens of House Democrats standing proudly behind an incredibly unpopular Nancy Pelosi as she prepares to lead them off a political cliff,” National Republican Congressional Committee spokesman Ken Spain told the Washington Post.

Democrats’ reaction to the bill was mixed, from both the conservative and liberal side of the party.

Rep. Health Schuler, a conservative Blue Dog Democrat from North Carolina, said that it had “significant improvements” over the earlier committee versions of the bills, but declined to comment on whether he plans to vote for it.

And Rep. Anthony Weiner, D-N.Y., expressed disappointment with some of the compromises that he said weakened the public option.

Still, he told reporters: “If I would have said to you two months ago we’d have had a bill with a public option, most of you would have said, ‘nah, that’s not going to happen.’ Now it’s a virtual consensus.”

House leaders aim to bring the legislation to the floor for debate next week. House Majority Leader Steny Hoyer, D-Md., said that the entire 1990-page bill will be online for at least 72 hours before representatives are asked to vote.