Obama Urges Excise Tax on High-Cost Insurance

WASHINGTON — President Obama told House Democratic leaders at a meeting on Wednesday that they should include a tax on high-priced insurance policies favored by the Senate in the final version of far-reaching health care legislation, aides said.

The White House has long expressed a preference for the excise tax on high-cost plans, which health economists say could be an important tool in controlling long-term health care spending for the government and for individuals and families.

But House Democrats have resisted the idea, which is also strongly opposed by many organized labor groups — an important part of the party’s base — because the tax may hit a number of more generous union-sponsored health plans.

The Senate proposal would impose a 40 percent excise tax on the cost of individual insurance policies above $8,500 and on family policies above $23,000, with higher thresholds for retirees and employees in high-risk fields like police officers.

The tax would raise $149 billion over 10 years, according to the Congressional Budget Office. The Senate bill would cost $871 billion over 10 years, while the House bill would cost nearly $1.1 trillion.

The meeting among Mr. Obama, Speaker Nancy Pelosi and top committee chairmen responsible for the health care bill came as Congressional leaders have stepped up efforts to reconcile differences between the House and Senate bills.

Ms. Pelosi, emerging from the meeting, said she expected those differences to be worked out soon.

“We have had a very intense couple of days with meetings in our leadership, meetings with our staff,” she said. “After our leadership meeting this morning, our staff engaged with the Senate and the administration’s staff to review the legislation, suggest legislative language. I think we’re very close to reconciliation.”

Mr. Obama has mostly tried to avoid taking public positions on potential disputes between the chambers, to the point that some lawmakers, including some Congressional leaders, have complained that the White House has not provided enough guidance.

Instead, the president and some of his advisers have talked circuitously about what they believe to be some of the more useful policy goals.

The budget director, Peter R. Orszag, for instance, has repeatedly extolled the potential economic merits of the proposed tax on high-cost insurance plans, as well as an independent agency to recommend potential government savings in Medicare.

Both of those ideas were included in the Senate bill, but not the House measure.

Senate Democrats are generally believed to have greater leverage in the negotiations to reconcile the two bills because they cannot afford to lose a single vote and some centrists have warned that they would turn against the bill depending on how it changes.

The Senate approved its bill on a party-line vote, 60 to 39, on Dec. 24.

But the House does not have much wiggle room either. It approved its bill on Nov. 7 by a vote of 220 to 215, with just one Republican joining 219 Democrats in favor. That means Ms. Pelosi could spare just two votes without jeopardizing the bill’s chances.

Among the big differences between the two bills are the provisions to pay for the legislation. Both measures rely on huge reductions to slow the growth in government spending on Medicare.

The Senate also proposed an increase in the Medicare payroll tax for individuals earning more than $200,000 and couples earning more than $250,000. The House proposed an income surcharge on individuals earning more than $500,000 and couples earning more than $1 million.

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