Liberals revolt after Blue Dog health deal

Just hours after House Democratic leaders announced a deal with their party’s conservative Blue Dogs on a sweeping health care reform bill, their liberal wing is pushing back.

House Energy and Commerce Committee Chairman Henry Waxman, D-Calif., postponed his panel’s markup of the bill, which was to take place Wednesday afternoon, and rescheduled it for Thursday morning.

The reason behind the cancellation is a lack of cooperation from the House Progressive Caucus, made up of more than 80 members. It is the most liberal faction in Congress.

The group fears that the deal Democratic leaders struck with the Blue Dogs has weakened the public option too much and will water down the competition they want to bring to the private insurance industry.

For instance, the original bill would have allowed the government to reimburse doctors at near-Medicare rates under the government health care option. The deal struck with the Blue Dogs would prohibit the government form using Medicare rates and would require the Department of Health and Human Services to negotiate payment. The bill also excludes small businesses with payrolls of less than $500,000 from having to buy health insurance for employees, up from $250,000.

A top Democratic leadership aide said the disagreement with the Progressives will be resolved in time for the markup to take place Thursday.

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