Democrats are mounting a last-ditch attempt to broker a bipartisan deal to reform America's health care system as Barack Obama prepares to address Congress.
By Toby Harnden in Washington Published: 8:32PM BST 08 Sep 2009
The speech to Congress is seen as so important that it could make or break his presidency.
With Mr Obama's poll numbers slipping and public support for his health care overhaul eroding almost by the day, Senator Max Baucus, a fellow Democrat, drew up a compromise plan designed to appeal to centrists across the political divide.
Republicans have vigirously opposed a mooted extra tax burden on highers earners to pay for medical insurance for the poor. Under the new plan, non-profit co-operatives would be set up to compete with private health insurance companies.
This would replace the idea of introducing a so-called "public option" of government-run insurance, which is favoured by liberals.
The Baucus plan would cost about $900 billion (£550 billion) over 10 years - $100 billion less that the $1 trillion price tag on a previous House of Representatives proposal.
This would partly be achieved by raising $180 billion from taxing insurance companies that offer the most expensive packages.
All insurance companies would be charged an additional fee according to their market share. This is intended to help pay for the reform and exact a price from insurers, who stand to gain 46 million new customers - those who are currently uninsured.
Mr Baucus said that the plan was not a final one and that he hoped a deal might be reached before Mr Obama speaks to a joint session of Congress on Wednesday.
Mr Obama is following in the footsteps of President Bill Clinton, who addressed Congress in 1993 with a plea for health care reform to be passed. Although public support for his plan increased, he was ultimately unsuccessful.
Acutely aware of the mistakes Mr Clinton made, Mr Obama decided to let Congress draft legislation rather than drawing up a White House bill, as Mr Clinton did. But that has led to a sense of drift with voters not sure exactly what Mr Obama supports.
Mr Obama's aides have indicated that the "public option" idea will be dropped after it became clear it was too politically contentious among the public, Republicans and conservative Democrats.
Mr Baucus's Senate Finance Committee has so far been unable to agree on legislation and he is attempting to woo three Republican senators who might be convinced.
If a deal is not reached, the Senate Finance Committee could be bypassed.
Senator Chuck Grassley, one of the Republicans being courted, told CNN that the Obama administration had been "all over the ballpark" on the health issue before Congress's summer recess and that he still wanted to find a bipartisan consensus.
Asked about the prospects of the Baucus plan being agreed, he replied: "We won't know until we meet. The good and the bad of the president speaking this week is we've had to speed up the work of our group to have something better ... and that's bad because we probably should have taken a little more time."
He added that he was concerned that any fee charged to insurance companies would end up getting passed on to other customers but was in favour of non-profit health care co-operatives.
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