Medicare plan may be dead

WASHINGTON - Senate Democratic leaders appeared poised last night to abandon efforts to create a government-run insurance safety net in their push for a health-care overhaul, as they attempted to close ranks around a bill they hoped would win the backing of all 60 members of their caucus.

Democratic negotiators had already disappointed liberal lawmakers by jettisoning a full-fledged public insurance plan a week earlier. Last night, party leaders conceded that the compromise they crafted to replace the public option - which included a proposal allowing people as young as 55 to buy into Medicare - also did not have sufficient support from Democratic moderates to overcome a likely Republican filibuster.

Majority Leader Harry Reid (D., Nev.), after consulting with senior White House officials, rallied his caucus in a closed-door meeting, reminding senators that there was broad consensus behind most of the provisions in the $848 billion package and warning them of the consequences of not passing a bill before the end of the year.

"Democrats are not going to let the American people down," he said after the meeting. "I am confident that by next week, we will be on our way to final passage."

The contents of the legislation probably will not be known until today, at the earliest, when the Congressional Budget Office is expected to provide an official cost analysis.

Senate Democrats will head to the White House this afternoon to meet with President Obama. The Medicare buy-in proposal, announced last week by 10 moderate and liberal Democrats, was applauded as a worthy effort by Obama but received a cool reception from a small but crucial bloc of Democratic senators who have not committed to supporting the bill.

On Sunday, Sen. Joseph Lieberman (I., Conn.), whose vote is needed to break a GOP filibuster, appeared to deal the plan a mortal blow when he told Reid he would not support any form of buy-in.

Reid and other Democratic leaders were furious with Lieberman, but his announcement forced a quick resolution to an issue that has clouded the health-care debate from the outset. Liberal lawmakers in both the House and Senate have insisted on a public option as a way to force competition in marketplaces with few private insurers. But conservatives in both chambers are strongly opposed to the idea, seeing it as an unwarranted expansion of government that would squeeze private firms out of business.

The Medicare buy-in plan was a scaled-back version of the original public option and was envisioned as offering coverage to individuals between ages 55 and 64 who do not have access to employer benefits. Reid and White House officials were prepared to narrow the framework, essentially walling it off from the Medicare program while vastly reducing the pool of potential beneficiaries.

But even as the CBO was examining the buy-in, Lieberman decided he could not accept it, and Reid was forced to face dropping it to prevent the bill from failing in its first procedural vote, which probably will occur later this week.

Although no final decision is expected until the CBO data are in hand today, Democrats left a 90-minute emergency caucus meeting last night convinced of the proposal's demise. "It's looking like that's the case," said Senate Finance Chairman Max Baucus (D., Mont.). "It's just a matter of getting support from 60 senators."

Last night's meeting featured numerous speeches. One passionate endorsement of the bill came from Sen. Arlen Specter (D., Pa.), who switched parties earlier this year. Specter urged his Democratic colleagues, "Don't let those obstructionists win," one participant recalled. The room erupted in applause when Specter reminded the group, "I came to this caucus to be your 60th vote."

But soon after the speech, Sen. Ben Nelson (D., Neb.) left the session early, telling reporters he remained undecided.

Also late yesterday, Reid sought to settle other issues preventing the bill from moving forward. He spent much of the afternoon trying to satisfy Nelson's concerns about abortion coverage, Reid spokesman Jim Manley said. That effort is expected to continue today.

Under pressure from AARP, a lobby for retirees, Senate leaders also agreed to close the annual gap in Medicare prescription-drug coverage known as the "doughnut hole." The gap leaves beneficiaries to pay for their own medicine after they have received $2,700 in covered drugs. Coverage picks up again when drug costs hit $6,100, but few seniors make it through the doughnut hole to the other side.