WASHINGTON – His calls for compromise rebuffed by Republicans, the Democratic chairman of the Senate Finance Committee unveiled sweeping legislation Wednesday to remake the nation's costly health care system largely along the lines outlined by President Barack Obama.

Sen. Max Baucus' proposal, months in the making, drew quick criticism from liberals who said his vision was too cramped and from Republicans who deemed it overly expansive. Yet whatever its fate, its mere release marked a critical turning point in Congress' long and tumultuous debate over Obama's top domestic priority.

The Finance Committee is to meet next week to vote on the plan, and after combining it with another panel's bill, Majority Leader Harry Reid intends to begin debate on the Senate floor late this month or early October. Across the Capitol, Speaker Nancy Pelosi has been waiting to see Baucus' health care prescription before advancing companion legislation toward a vote by the House.

"We cannot let this opportunity pass," Baucus, D-Mont., said as he outlined a $856 billion plan designed to protect millions who have unreliable insurance or no coverage at all, at the same time restraining the explosive growth of medical costs.

Congressional budget experts estimated the proposal would reduce the ranks of the uninsured by 29 million over a decade. They also predicted the plan would trim federal deficits by $49 billion over the same period and suggested savings in the range of hundreds of billions of dollars might result for the decade that follows.

Many of the bill's major provisions would be delayed until 2013, after the next presidential election.

But the impact of one of the key concessions Baucus made in a so-far-unsuccessful search for Republican support — allowing cooperatives, rather than the federal government, to sell insurance in competition with private industry — was judged harshly.

"They seem unlikely to establish a significant market presence in many areas of the country," wrote Douglas W. Elmendorf, head of the Congressional Budget Office.

Supporters claim the co-ops would compete effectively with private companies and help hold down the cost of insurance, but CBO's assessment is likely to re-energize advocates of direct government competition.

White House press secretary Robert Gibbs called the overall legislation an "important building block" that "gets us closer to comprehensive health care reform."

Reid, too, described it as "another important piece to the puzzle" on the road to health care legislation.

Pelosi said that while the bill would do less than House legislation to make coverage more affordable, its emergence "will move this historic debate forward."

Senate Republican leader Mitch McConnell of Kentucky, who has labored to keep his rank and file united in opposition, called it a partisan proposal that "cuts Medicare by nearly a half-trillion dollars and puts massive new tax burdens on families and small businesses, to create yet another thousand-page, trillion-dollar government program. Only in Washington would anyone think that makes sense, especially in this economy."

Baucus' legislation reflected nearly a year of preparation by the 67-year-old Montanan, a partially successful attempt to gain support from outside interest groups, and months of painstaking private negotiations with two other Democrats and three Republicans on the Finance Committee.

With White House backing, the nation's drug makers and hospitals have agreed to defray part of the expense of the eventual bill, and the Pharmaceutical Research and Manufacturers of America is underwriting a television advertising campaign at a cost of tens of millions in favor of health care legislation. The AARP generally supports the effort as well, despite the cuts in planned Medicare spending, and even opposition from the insurance industry has been somewhat muted.

Even so, the private negotiations involving Republican Sens. Chuck Grassley of Iowa, Mike Enzi of Wyoming and Olympia Snowe of Maine came up short, at least for the time being.

Baucus told reporters he expected he would gain bipartisan backing before the bill emerges from committee, probably next week, an evident reference to Snowe. "This is a first step in the process," Snowe said in a written statement, and she promised to continue to work with Baucus and Democrats on drafting a bipartisan bill.

The other Democrats in the talks were Kent Conrad of North Dakota and Jeff Bingaman of New Mexico.

Like other proposals in circulation, Baucus' plan would require insurance companies to sell coverage to all seeking it, without exclusions for pre-existing medical conditions or prohibitively expensive premiums.

The legislation would create so-called insurance exchanges in the states where companies could sell policies that meet criteria set by the government, with federal subsidies available for lower-income individuals and families who would otherwise be unable to afford coverage. Any policy offered for sale in the exchanges would have to cover preventive and primary care as well as dental, prescription drug, mental health and vision services. In general, consumer copays on preventive coverage would be banned.

Additionally the plan envisions cutting a coverage gap in Medicare prescription drug program in half over a decade, although not as deeply as Obama called for in last week's prime-time speech.

To hold down costs, Baucus included only one year of a 10-year, $230 billion increase in doctor fees under Medicare.

The legislation calls for a new tax on high-cost insurance plans, a series of fees and taxes on insurance companies, the pharmaceutical industry and other health care providers, and penalties assessed on people who refuse to purchase coverage or large companies that refuse to offer it to their employees.

Planned Medicare spending would be cut by roughly $500 billion over a decade, with about one-quarter of that money coming from private plans sold as an alternative to traditional government coverage. The House bill calls for far deeper cuts in the alternative program, to the point that industry officials say it could disappear.

Among Baucus' critics were liberals in the House and labor leaders who have been among Obama's strongest supporters.

Sen. Ron Wyden, D-Ore., who has long been involved in health care issues, said the proposal doesn't go far enough to control costs or guarantee a greater choice among health plans for consumers.

Chuck Loveless, the director of legislation at the American Federation of State, County and Municipal Employees, said, "Chairman Baucus has made what I would characterize as a herculean effort to produce this, but we think that the cost has been too high, and we want to see major changes."

In the House, Rep. Anthony Weiner of New York, who favors a government-run program, said, "I think I speak for many members of Congress in saying that the Senate proposal simply will not pass muster in the House of Representatives and fails on very basic levels to satisfy the objectives of the president and the citizens of the United States of America."

Like authors of competing bills in the House and in the Senate Health, Education, Labor and Pensions Committee, Baucus worked his way through numerous controversial issues. Unlike them, though, his reflected a desire to seek bipartisanship.

Thus, the bill includes provisions to keep illegal immigrants from obtaining health coverage through the new insurance exchanges.

The bill also would prevent federal funds from being used to pay for abortions except in cases of rape, incest or if the life of the mother would be endangered. It would leave in place state laws that protect health care workers who refuse to participate in abortion coverage.

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Associated Press writers Ricardo Alonso-Zaldivar, Erica Werner and Julie Hirschfeld Davis contributed to this report.

WASHINGTON – Senators closing in on a comprehensive health care bill have whittled away all but the most contentious issues and one of those loomed large Friday: coverage for illegal immigrants.

Negotiators on the Senate Finance Committee thought they'd already resolved the question. That was before Republican Rep. Joe Wilson's shout of "You lie!" as President Barack Obama said in a speech Wednesday that illegal immigrants wouldn't be covered under his health plan.

That led senators to revisit the issue to make sure they have provisions in place to enforce prohibitions against illegal residents getting federally subsidized coverage.

"What we are trying to prevent is anyone who is here illegally from getting any federal benefit," said Sen. Kent Conrad, D-N.D., a member of the so-called Gang of Six of three Democratic and three Republican members of the Finance Committee. The group is facing a deadline early next week to produce a bipartisan deal.

If they don't succeed, Chairman Max Baucus, D-Mont., plans to go it alone with a Democratic bill.

The outcome remains very much in doubt. A successful effort could form the basis for legislation that could appeal to a majority in the Senate since the Finance Committee has a moderate makeup that resembles the Senate as a whole.

This weekend will be critical as aides and lawmakers themselves hammer out language not just on illegal immigration, but also a handful of other thorny issues including abortion, medical malpractice and how much states must pay for an expansion of Medicaid.

The deal-or-no-deal question could be answered as early as Monday when the group meets again.

"Obviously we'll find out who wants to support the (bill) and who doesn't," Baucus said Friday. "I'm hopeful that there will be bipartisan support. And I'll keep working on it frankly over the weekend, on the telephone talking to people, so on and so forth."

Baucus' plan largely mirrors what Obama laid out in his speech Wednesday: expansion of coverage to most of the nearly 50 million uninsured, new requirements for individuals to obtain insurance, new prohibitions against insurance company practices like denying coverage based on personal health history and creation of a new marketplace called an exchange where consumers could shop for different health plans.

If Congress ends up creating a new government-run insurance plan it would be offered through the exchange, but unlike the four partisan bills that have emerged from committees in the House and Senate so far, Baucus' bill will substitute nonprofit co-ops for the public plan.

The White House says that Obama does not want illegal immigrants to be able to buy insurance through the new purchasing exchange as they would be allowed to do under Democratic legislation in the House. Spokesman Robert Gibbs said the White House will work with lawmakers on language to enforce that. Though the issue is not yet finalized, the Finance Committee is expected to follow the White House's lead in barring illegal immigrants from the exchange, according to a Democratic committee aide. The aide spoke on condition of anonymity because of the ongoing negotiations.

"Illegal immigrants would not be allowed to access the exchange that is set up," Gibbs said Friday. Verification requirements are "something we'd work out with Congress," he said.

The illegal immigrant controversy that led to the outburst from South Carolina's Wilson stems from Republicans' contention that illegal immigrants would be able to get federally funded health coverage under the House health bill — even though the bill expressly prohibits federal subsidies for illegals.

Critics note that there are no enforcement mechanisms, or language on how to verify whether or not someone is in this country legally.

"Without a verification requirement it's essentially like posting a 55-mph speed limit and not having any highway patrol on the road," said Ira Mehlman, spokesman for the Federation for American Immigration Reform.

Democrats in two House committees defeated amendments that would have required verification of legal status. Many Democrats contend that such measures create barriers to legal residents getting the health coverage they need.

Verification provisions added to Medicaid several years ago require people to provide documentation of citizenship and identity, said Jennifer Tolbert, a policy analyst at the nonpartisan Kaiser Family Foundation.

She said states found that the new requirements mainly caused delays or denials for people who were entitled to be part of the program.

There are some 7 million illegal immigrants in this country who lack health insurance, according to the Pew Hispanic Center.

Unlike in the House bill or legislation passed by the Senate's health committee, the Finance Committee is aiming to include verification requirements. Anyone who tries to get subsidized coverage through the new health insurance exchange would have to provide valid Social Security numbers. Aides are working through the weekend to complete how that requirement would be implemented.

Another unsettled issue involves coverage for legal immigrants. Gang of Six member Sen. Chuck Grassley, R-Iowa, wants a five-year waiting period before legal immigrants can get subsidized coverage, but Conrad said Friday that's not yet been resolved.

WASHINGTON – President Barack Obama used only-in-Washington accounting Wednesday when he promised to overhaul the nation's health care system without adding "one dime" to the deficit. By conventional arithmetic, Democratic plans would drive up the deficit by billions of dollars.

The president's speech to Congress contained a variety of oversimplifications and omissions in laying out what he wants to do about health insurance.

A look at some of Obama's claims and how they square with the facts or the fuller story:

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OBAMA: "I will not sign a plan that adds one dime to our deficits either now or in the future. Period."

THE FACTS: Though there's no final plan yet, the White House and congressional Democrats already have shown they're ready to skirt the no-new-deficits pledge.

House Democrats offered a bill that the Congressional Budget Office said would add $220 billion to the deficit over 10 years. But Democrats and Obama administration officials claimed the bill actually was deficit-neutral. They said they simply didn't have to count $245 billion of it — the cost of adjusting Medicare reimbursement rates so physicians don't face big annual pay cuts.

Their reasoning was that they already had decided to exempt this "doc fix" from congressional rules that require new programs to be paid for. In other words, it doesn't have to be paid for because they decided it doesn't have to be paid for.

The administration also said that since Obama already had included the doctor payment in his 10-year budget proposal, it didn't have to be counted again.

That aside, the long-term prognosis for costs of the health care legislation has not been good.

CBO Director Douglas Elmendorf had this to say in July: "We do not see the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount."

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OBAMA: "Nothing in this plan will require you or your employer to change the coverage or the doctor you have."

THE FACTS: That's correct, as far as it goes. But neither can the plan guarantee that people can keep their current coverage. Employers sponsor coverage for most families, and they'd be free to change their health plans in ways that workers may not like, or drop insurance altogether. The Congressional Budget Office analyzed the health care bill written by House Democrats and said that by 2016 some 3 million people who now have employer-based care would lose it because their employers would decide to stop offering it.

In the past Obama repeatedly said, "If you like your health care plan, you'll be able to keep your health care plan, period." Now he's stopping short of that unconditional guarantee by saying nothing in the plan "requires" any change.

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OBAMA: "The reforms I'm proposing would not apply to those who are here illegally." One congressman, South Carolina Republican Joe Wilson, shouted "You lie!" from his seat in the House chamber when Obama made this assertion. Wilson later apologized.

THE FACTS: The facts back up Obama. The House version of the health care bill explicitly prohibits spending any federal money to help illegal immigrants get health care coverage. Illegal immigrants could buy private health insurance, as many do now, but wouldn't get tax subsidies to help them. Still, Republicans say there are not sufficient citizenship verification requirements to ensure illegal immigrants are excluded from benefits they are not due.

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OBAMA: "Don't pay attention to those scary stories about how your benefits will be cut. ... That will never happen on my watch. I will protect Medicare."

THE FACTS: Obama and congressional Democrats want to pay for their health care plans in part by reducing Medicare payments to providers by more than $500 billion over 10 years. The cuts would largely hit hospitals and Medicare Advantage, the part of the Medicare program operated through private insurance companies.

Although wasteful spending in Medicare is widely acknowledged, many experts believe some seniors almost certainly would see reduced benefits from the cuts. That's particularly true for the 25 percent of Medicare users covered through Medicare Advantage.

Supporters contend that providers could absorb the cuts by improving how they operate and wouldn't have to reduce benefits or pass along costs. But there's certainly no guarantee they wouldn't.

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OBAMA: Requiring insurance companies to cover preventive care like mammograms and colonoscopies "makes sense, it saves money, and it saves lives."

THE FACTS: Studies have shown that much preventive care — particularly tests like the ones Obama mentions — actually costs money instead of saving it. That's because detecting acute diseases like breast cancer in their early stages involves testing many people who would never end up developing the disease. The costs of a large number of tests, even if they're relatively cheap, will outweigh the costs of caring for the minority of people who would have ended up getting sick without the testing.

The Congressional Budget Office wrote in August: "The evidence suggests that for most preventive services, expanded utilization leads to higher, not lower, medical spending overall."

That doesn't mean preventive care doesn't make sense or save lives. It just doesn't save money.

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OBAMA: "If you lose your job or change your job, you will be able to get coverage. If you strike out on your own and start a small business, you will be able to get coverage."

THE FACTS: It's not just a matter of being able to get coverage. Most people would have to get coverage under the law, if his plan is adopted.

In his speech, Obama endorsed mandatory coverage for individuals, an approach he did not embrace as a candidate.

He proposed during the campaign — as he does now — that larger businesses be required to offer insurance to workers or else pay into a fund. But he rejected the idea of requiring individuals to obtain insurance. He said people would get insurance without being forced to do so by the law, if coverage were made affordable. And he repeatedly criticized his Democratic primary rival, Hillary Rodham Clinton, for proposing to mandate coverage.

"To force people to get health insurance, you've got to have a very harsh penalty," he said in a February 2008 debate.

Now, he says, "individuals will be required to carry basic health insurance — just as most states require you to carry auto insurance."

He proposes a hardship waiver, exempting from the requirement those who cannot afford coverage despite increased federal aid.

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OBAMA: "There are now more than 30 million American citizens who cannot get coverage."

THE FACTS: Obama time and again has referred to the number of uninsured as 46 million, a figure based on year-old Census data. The new number is based on an analysis by the Kaiser Commission on Medicaid and the Uninsured, which concluded that about two-thirds of Americans without insurance are poor or near poor. "These individuals are less likely to be offered employer-sponsored coverage or to be able to afford to purchase their own coverage," the report said. By using the new figure, Obama avoids criticism that he is including individuals, particularly healthy young people, who choose not to obtain health insurance.

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Associated Press writer Jim Kuhnhenn contributed to this report.