Nov. 21 (Bloomberg) -- Democrats united to bring sweeping health-care legislation to the U.S. Senate floor in a 60-39 party-line vote that kept Republicans from blocking debate on President Barack Obama’s top domestic initiative.

Senate Majority Leader Harry Reid won over two holdouts in his party today after weeks of questions about whether Democrats could stick together to clear the first hurdle to passage. The $848 billion, 10-year plan proposes the biggest changes to the U.S. health-care system since the Medicare insurance program for the elderly was created in 1965.

“In the coming weeks, we’ll finally put people, not insurance companies, in charge of their lives,” Reid said on the Senate floor. He said the vote is merely to get the debate started, adding, “Don’t try to silence debate over a grave crisis.”

Republican George Voinovich of Ohio didn’t vote tonight. Every Senate Republican opposes the legislation, so Reid can’t afford any defections from his 60-member caucus when the Senate begins weeks of debate after the Thanksgiving recess. Reid aims for a final vote by the end of the year.

White House spokesman Robert Gibbs said in a statement the vote “brings us one step closer to ending insurance company abuses, reining in spiraling health-care costs, providing stability and security to those with health insurance, and extending quality health coverage to those who lack it.”

31 Million Uninsured

The legislation is intended to cover 31 million uninsured people and curb medical costs. Like a bill passed Nov. 7 by the U.S. House, the Senate plan would require all Americans to get health coverage. It would set up online insurance-purchasing exchanges and provide subsidies for those who can’t afford to buy coverage.

“It is time for us to face the crisis,” said Senate Finance Committee Chairman Max Baucus, a Montana Democrat. “It is time for Congress to show mature leadership. It is time for us to reform health care, once and for all.”

Louisiana Senator Mary Landrieu and Arkansas Senator Blanche Lincoln, the last two Democrats to agree to allow the start of debate, are among those in the party who say big changes must be made to get their vote for the final bill.

“My vote to move forward on this important debate should in no way be construed by the supporters of this current framework as an indication of how I might vote as this debate comes to an end,” Landrieu said. “Much more work needs to be done.”

Explode the Deficit

Republicans predicted that the measure will explode the U.S. budget deficit, cause rationing of health care and fail to produce the cost savings that are a chief goal. Republican leaders say the true cost of the legislation is about $2.5 trillion over a decade.

A vote for the bill would support “the spending binge that is leading to a massive and unsustainable long-term debt that will shackle our children to a future they can’t afford,” said Senate Republican leader Mitch McConnell of Kentucky.

“Senator Reid’s claim that the cost is $848 billion is the ultimate Washington gimmick, at taxpayers’ expense,” said Senator Charles Grassley of Iowa, the top Republican on the Finance Committee.

In debating the 2,074-page bill, senators will focus on issues including how to pay for the legislation and how strictly to prohibit the use of federal money to fund abortions.

Government-Run Insurance

One key sticking point: the Senate bill would create a government-run insurance program, the so-called public option, to compete against private insurers such as Hartford, Conn.- based Aetna Inc. The measure would let individual states choose not to offer it.

Another issue is whether to help finance the plan through a 40 percent tax on high-value insurance policies. Labor unions object to the tax, saying their members would be hit too hard.

Senate Democrats Ben Nelson of Nebraska, Lincoln and Landrieu oppose the public option and want other changes such as adjustments in the abortion language and more aid for small businesses.

One independent who caucuses with Democrats, Connecticut Senator Joe Lieberman, has said he won’t support a bill if it includes the government-run insurance plan. The only Republican who supported a health bill in a committee vote, Olympia Snowe of Maine, said she won’t vote for legislation that includes a government option.

Possible Amendment

She said she hasn’t decided whether to offer an amendment, supported by some Democratic centrists, to create a government insurance plan only if there is evidence that private insurers aren’t offering enough affordable policies.

In a statement late yesterday, the White House urged lawmakers to back the bill, saying it meets the criteria for an overhaul costing less than $900 billion over 10 years.

The legislation “includes critical reforms to the insurance industry, so that Americans will no longer have to worry that they will be denied coverage, or that their coverage will be dropped or watered down when they need it most,” the statement said.

In a sign that abortion remains a stumbling block, the U.S. Conference of Catholic Bishops yesterday sent a letter calling the Senate measure an “enormous disappointment.” The bishops said the bill did “not live up to Obama’s pledge to bar the use of federal dollars for abortion.”

Existing Restrictions

Senate Democratic leaders say the measure maintains existing restrictions on the use of taxpayer dollars for abortion services. It requires state insurance purchasing exchanges to offer at least one policy that offers abortion coverage and one that doesn’t.

The House legislation goes further, barring the government insurance program from covering abortions and prohibiting federal money from being used on the online exchange to buy a private policy that covers abortion.

If the Senate passes a bill, it would work on compromise legislation with the House for a new round of votes in both chambers before a measure could go to Obama.

While the Senate vote tonight was simply on whether to keep Republicans from blocking consideration of the bill, it’s rare for a broader measure to fail after it clears such an obstacle.

A Congressional Research Service analysis found only one instance between 1999 and 2008 when Senate legislation failed after clearing the hurdle to begin debate. That was a measure designed to protect gun manufacturers from lawsuits that was rejected in 2004.

After agreeing to begin debate, the Senate “almost always proceeded to a final vote on the measure and passed it,” CRS analysts wrote.

To contact the reporter on this story: Laura Litvan in Washington at llitvan@bloomberg.net

Last Updated: November 21, 2009 20:57 EST