Nov. 9 (Bloomberg) -- On Nov. 7, The House of Representatives became the first U.S. legislative chamber to pass an overhaul of the health-care system, with the goal of expanding coverage to tens of millions of Americans without insurance and curtailing costs.

The House voted on a combined measure based on versions from three committees and now waits for the Senate to finish and vote on legislation before starting talks on a compromise between the two chambers. Senate leaders are still struggling to reach consensus on the work of two different committees.

Only one Republican, Representative Joseph Cao of Louisiana, supported the House measure. And Maine Senator Olympia Snowe is the only Republican who has voted for a Senate plan, the one passed on Oct. 13 by the finance panel. Snowe is now withholding her support as Senate Majority Leader Harry Reid pushes for the creation of a government-run insurance program, commonly known as the public option.

The following outlines some of the biggest similarities and differences in the plans:

Common Ground

INDIVIDUAL MANDATE: The House and Senate plans require individuals to get health insurance, with varying penalties for failing to do so. They also include government subsidies or expanded programs to help people with lower incomes purchase coverage. New online exchanges would be created so people can shop for policies at more affordable group rates. About 15 percent of U.S. residents, or some 46 million, lacked health insurance in 2008, according to the U.S. Census Bureau.

EXPANDING COVERAGE: President Barack Obama and top Democrats in Congress say they want to cover all Americans, yet the proposals would still leave millions of people not eligible for Medicare uninsured, according to the nonpartisan Congressional Budget Office. Under the House proposal, about 18 million non-elderly people, including millions of illegal immigrants, would lack coverage, the CBO estimated. The Senate Finance Committee plan would leave about 25 million uninsured, a third of them illegal immigrants, the CBO said on Oct. 7.

INSURER REQUIREMENTS: Insurers would no longer be able to reject new customers with pre-existing medical conditions; new restrictions would be placed on their ability to set premiums.

REDUCING COSTS: The legislation is intended to lower long- term health-care costs for consumers and the government.

All the plans call for greater access to preventive care, either with new programs or the elimination of co-payments, a change that proponents argue will save money by keeping people from developing illnesses that are more costly to treat. They also call for more use of electronic systems to promote better record-keeping and reduce overhead costs.

Obama favors a new independent commission to set reimbursement rates for providers who treat patients in Medicare, the federal program for the elderly. The Senate Finance Committee embraced a version of this idea. The House bill establishes the Center for Medicare Innovation “to pursue additional payment and delivery system reforms.”

BIOLOGICS: Biologic drugs, made from living cells by companies such as Thousand Oaks, California-based Amgen Inc., would get 12 years of protection from generic competition under plans passed by the House and the Senate health committee. The White House had sought to limit the exclusivity to seven years as a way of bringing prices down.

COMPARING TREATMENTS: Legislation in both the House and Senate would create research centers to examine the efficacy of various health-care services, devices, treatments and procedures. None of the bills require the research be used to force health providers to adopt new procedures or policies to cut costs, which is an administration priority. Obama provided $1.1 billion in the stimulus act to fund so-called comparative effectiveness research.

THE DEFICIT: House and Senate leaders pledged to come up with legislation that doesn’t add to the federal budget deficit, a requirement set by Obama. The CBO estimated that the Senate Finance Committee plan would meet that goal and cost $829 billion over 10 years. The House would also meet the goal at a cost of more than $1 trillion, the CBO said.

Differences

PUBLIC OPTION: The House would create a new government-run insurance program designed to compete with private companies such as Minnetonka, Minnesota-based UnitedHealth Group Inc. and help reduce prices for insurance in the market. The plan requires that the new entity negotiate rates with medical providers as private insurers do, instead of pegging rates to the lower fees paid by Medicare.

In the Senate, Reid also is pushing for a public option, though his proposal would allow states to opt out of the program. The Nevada Democrat also may not have the votes to push it through after the two committees split in his chamber.

The Senate health panel supported the public option and the finance committee voted against it in favor of nonprofit cooperatives, or networks of health-insurance plans owned by the customers they serve, that would get government seed money.

EMPLOYER MANDATE: The House requires that employers cover their workers or pay a penalty, with potential exemptions for some businesses because of size or hardship. The measure under consideration by Reid, tracking the Senate finance panel’s work, would instead require that employers with more than 50 full-time workers pay a fee for every lower-income employee who qualifies for a new tax credit to obtain care.

HOW TO PAY FOR IT: The House version would add a surtax on the wealthiest Americans, starting with couples who earn more than $1 million a year. The chamber also has other taxes including one designed to raise $20 billion over 10 years from medical device makers.

The Senate version would tax insurers on the most generous, so-called Cadillac benefit plans. It also includes new annual fees on insurers, medical-device manufacturers, drugmakers and clinical laboratories beginning in 2010 and imposed based on market share. Because only the finance committee has jurisdiction over funding in the Senate, there’s no conflict between panels.

In addition, the House is looking for other ways to pay for health care, such as a proposal to keep pulp and paper makers from claiming up to $24 billion in tax credits. The plan would bar companies from using an Internal Revenue Service ruling made public last month to claim a $1.01 a gallon tax credit for producing cellulosic biofuel from so-called black liquor, a wood byproduct from pulp-making.

What’s Next

Reid is waiting for CBO cost estimates before bringing a combined measure to the full chamber, controlled 60-40 by Democrats and the two independents who caucus with them.

Senate leaders are still working to win Republican backing because 60 votes is the minimum needed to overcome a legislative maneuver known as a filibuster that’s likely to come from opponents, and there’s no assurance the Democrats will stick together. Otherwise, Democratic leaders could resort to a budget process known as reconciliation, whose rules require only a majority for passage yet might force a scaled-back measure.

If measures pass both chambers, the House and Senate would work together to fashion a compromise for another round of votes. The final legislation would go to Obama to be signed into law. Obama and Democratic leaders in Congress say they want the bill signed by the end of this year.

That deadline may slip.

“We’re not going to be bound by any timelines,” Reid told reporters on Nov. 3.

To contact the reporters on this story: Kristin Jensen in Washington at kjensen@bloomberg.net; Nicole Gaouette in Washington at ngaouette@bloomberg.net

Last Updated: November 9, 2009 00:01 EST