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J. Scott Applewhite  /  AP
"I support this effort, especially since it's aimed at increasing choice and competition and lowering costs," the president said of an emerging compromise on the 'public option' in pending health reform legislation.
updated 12/9/2009 5:01:10 PM ET 2009-12-09T22:01:10

President Barack Obama as well as Democratic liberals and moderates all found something to like Wednesday in an emerging compromise to expand the role of government in the nation's health care system, raising hopes inside the party that passage of overhaul legislation might be within reach after a struggle lasting decades.

The same plan drew critics, though — and the threat of more opponents once closely held details become widely known.

Obama hailed "a creative new framework that I believe will help pave the way for final passage of legislation and a historic achievement for the American people." He said, "I support this effort, especially since it's aimed at increasing choice and competition and lowering cost."

A provision opening Medicare to uninsured Americans between the ages of 55 and 64 drew praise from some liberals.

Rep. Anthony Weiner, D-N.Y., called it "an unvarnished, complete victory for people like me who have been arguing for a single-payer system."

Howard Dean, the former party chairman and an advocate of a government-run insurance option, told CBS, "Using Medicare makes more sense than reinventing more bureaucracy."

The idea of a full-blown government-run insurance option, heatedly debated for months, would be jettisoned under the tentative agreement reached by Senate Democratic liberals and moderates and announced Tuesday night. In its place would be the expansion of Medicare, as well as new nationwide private plans to be run by the same agency that oversees the system that lawmakers use for themselves and their families.

Majority Leader Harry Reid, D-Nev., described the agreement as a significant step in the struggle to round up the votes needed to pass the broader overhaul legislation. The House has already passed its version, and Democrats are driving for a Senate vote before Christmas.

That would leave only a final compromise between the houses before legislation could go to Obama for his signature. Congress has spent months trying to deliver a bill to the White House that would expand coverage to millions who now lack it, ban insurance companies from denying coverage on the basis of pre-existing medical conditions and generally reduce the skyrocketing growth of medical spending nationwide.

Sen. Joe Lieberman, an independent from Connecticut who has vowed to fight any government-run insurance option, issued a statement saying he was "encouraged by the progress toward a consensus."

Lieberman's vote is one of 60 that Democrats would need to enact the legislation over unanimous Republican opposition, and he and Sen. Ben Nelson, D-Neb., are viewed as among the shakiest supporters of the bill.

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Two other senators in the same category praised different parts of the latest proposal.

Sen. Mary Landrieu, D-La., said the Medicare expansion could help small business.

"There are a lot of small business people who are between the ages of 55 and 64," she said. "If that were done (it) would provide some real relief to them."

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Sen. Blanche Lincoln, D-Ark., said she approved of the suggested national plans to be administered by the Office of Personnel Management. "OPM being the negotiator will help, I think, be able to bring the best product forward," she said.

According to several officials, the deal would maintain an existing federal health care program for children until 2015, when it would be folded into so-called national exchanges where consumers would purchase coverage.

Insurance companies would be required to spend 90 percent of their income from premiums on providing benefits.

Many officials declined to discuss details, heeding an admonition that if they did, the Congressional Budget office would feel compelled to release preliminary cost estimates that lawmakers prefer to receive secretly.

Thus, there was no word on the cost of purchasing Medicare coverage, as an example, in the years before 2014, when federal subsidies would become available for lower- and some middle-income individuals and families.

Sen. Olympia Snowe, R-Maine, told reporters premiums would total about $7,600 annually until federal subsidies became available in 2014. That translated into more than $600 a month, far higher than the $96.40 paid by beneficiaries age 65 and up.

Despite the praise from Obama and others, there were critics across the political spectrum.

They included MoveOn.org., the liberal group, which issued a statement saying Democrats had "bargained away the heart of health care reform allowing conservative senators like Joe Lieberman and Ben Nelson to hold the process hostage and protect Big Insurance."

The Mayo Clinic Health Policy Center sent notices to lawmakers criticizing the emerging plan. Expanding Medicare to individuals 55 to 64 years old, it said, "would ultimately hurt patients by accelerating the financial ruin of hospitals and doctors across the country."

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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