Health Care Battle Intensifies Despite Baucus' New Proposals

Sept. 17, 2009— -- It is a health care bill that had the most promise for gaining bipartisan momentum and came closest to what President Obama called for in his speech last week. But Sen. Max Baucus' ambitious 10-year, $856 billion proposal fell with a thud Wednesday on Capitol Hill.

Republicans predictably denounced the bill, but more troubling to the White House is the barrage of criticism from Democrats over the bill proposed by Montana's Baucus, the Democratic chairman of the Senate Finance Committee.

Sen. Jay Rockefeller, D-W.Va., warned that the bill would slap a "big, big tax" on middle-class Americans.

"It's a very dangerous idea," Rockefeller said Tuesday, referring to the 35 percent excise tax that would be imposed on insurance companies for high-cost plans -- on premiums greater than $8,000 for individuals and $21,000 for family plans.

The senator was called to the White House Wednesday to meet with the president to talk privately about his objections to Baucus' health care plan. Emerging from the Oval Office, the West Virginia senator at first refused to say what the two had talked about.

"I was alone with the president, and you don't breach that confidence," he told reporters."I will if we talk in the Capitol, but I won't here. It's just because we agreed that ... whatever went on there is not to be spoken about."

But, back on his turf on the Hill, he released a statement -- without going into specifics -- saying, "I have made clear I cannot vote for this bill in its current form."

Liberal groups had even tougher words for Baucus' proposals.

Justin Ruben, executive director of MoveOn.org, called the bill a "dream come true for the insurance industry."

"The Baucus bill will not solve the health care crisis that plagues millions of Americans, and fails to meet the basic tenets on successful reform laid out by President Obama," Ruben said in a statement. "The insurance companies have found their champion in Sen. Baucus. The only good news is that the senator stands nearly alone in supporting his bill."

The National Coalition on Health Care expressed its "deep disappointment" and others had even harsher words.

Baucus Health Care Plan

Baucus' bill comes the closest to what Obama said he wants to see in his address to the joint session of Congress last week.

The plan would make health insurance mandatory for all Americans, and employers and individuals would have to pay a heavy penalty if they don't purchase a plan -- up to $950 for individuals and $3,800 for families.

It would expand Medicaid benefits, making more people eligible, help those with household incomes of less than $66,000 buy insurance, and implement rules so that insurance companies cannot deny coverage based on pre-existing conditions, although certain provisions in the plan allow for flexibility on that point.

The plan scraps the option of a government-run insurance program that would compete with the private sector, but it does propose the idea of co-ops, which are nonprofit, member-based companies that would provide affordable coverage. Baucus also proposed a system of Web-based insurance exchange portals, an idea suggested by the president last week.

But many Democrats are outraged about the lack of a public option, or a "trigger" mechanism that would put such a plan in place if insurance companies fail to do their part. Even other provisions in Baucus' plan have yet to stick with many Democrats.

Florida Democrat Sen. Bill Nelson argued the bill would cut Medicare benefits.

"I think it would be intolerable to ask the senior citizens on Medicare who have [Medicare Advantage] to give up substantial health benefits that they're enjoying under Medicare," Nelson said on the Senate floor Wednesday.

Democrat Sen. Ron Wyden of Oregon told ABC News the bill would force many people to buy health insurance that they cannot afford.

"Under the draft proposals, certainly some significant number of middle-class folks could end up paying more," Wyden said Wednesday. "It doesn't pass the smell test."

As senators haggled over the bill, members of a House committee heard heart-wrenching stories Wednesday from Americans fighting their insurance companies. One of those testifying was Mark Gendernalik, who is struggling to get treatment for his 3-year-old daughter, Sidney, who has a neurological disorder.

"They were trying to exhaust us," the Los Angeles resident told lawmakers. "I spent so much time fighting to get care. I feel like her medical manager instead of her daddy. ... I need you people to let me be a daddy."

Top executives of some of the nation's largest insurance companies will be on Capitol Hill later today to respond to their critics. Meanwhile, Baucus will have to respond to critics, as well, as he presents his bill to a group of Senators today behind closed doors.

Baucus expressed optimism Wednesday that a final bill in the Senate would achieve bipartisan support. "At the end of the day, there will be Republican support for this bill," a confident Baucus told reporters.

But that may be a challenging task. Republicans are lining up against his proposal, with even moderate senators saying they need more time to get this right.

ABC News' Huma Khan contributed to this report.