WASHINGTON - - The Senate health committee, approving major health care legislation for the first time in 15 years, put forward a sweeping plan Wednesday to provide nearly every American with insurance regardless of income or medical condition and to create a government program to compete directly with private insurers.
The bill also would place new requirements on many employers to provide coverage.
The committee vote, along party lines, marked what President Barack Obama called "a major milestone" in his bid to revamp the U.S. health care system. Throughout the spring, the president successfully wooed many of the special interests that thwarted President Bill Clinton when he attempted a similar overhaul in 1993.
But there were ominous signs that the debate is moving into a new, more bruising phase in which insurance companies, hospitals and others fight to shape the details of legislative provisions that affect them.
California hospitals and insurers issued sharp warnings that a government insurance program could jeopardize patient care. And leading business organizations, many of which have been pushing for a health care overhaul, have stepped up their attacks on similar legislation that House Democrats introduced this week.
"It is clear that ... hospitals will not be able to maintain the level of services that they do today," Duane Donner, president of the California Hospital Association, said Wednesday.
And the National Federation of Independent Business, a historically conservative small-business group that is influential in the House, sent a letter to lawmakers saying that the bill "threatens the viability of our nation's job creators ... destroys choice and competition for private insurance, and fails to address the core challenge facing small business - cost."
But the dire predictions were contradicted by a preliminary Congressional Budget Office assessment of the public insurance option contained in the House bill. The CBO estimated that by 2019, just 9 million people nationally would get their insurance from the government plan, while more than 175 million people would get their coverage from private insurers.
The bill's overall cost would be $1 trillion to $1.2 trillion during the next decade, depending on changes to Medicare physician payments. It would impose a surtax on wealthy Americans, beginning with a 1 percent levy for couples earning $350,000 and rising to 5.4 percent on income above $1 million.
House Energy and Commerce Committee Chairman Henry A. Waxman, a California Democrat and lead author of the bill, brushed aside the complaints by the small-business group and the U.S. Chamber of Commerce, which had proclaimed their support for a health care overhaul in the earlier phase.
"They are against everything," Waxman said. "They don't want a health care bill." Waxman's comment reflected the fact that, as lawmakers push to get bills through the House and Senate by the time they leave for their August recess, liberal Democrats are becoming less tolerant of dissent from their supposed allies in the health care industry.
On Wednesday, senior Senate Democrats took aim at insurers, threatening to assess them a new fee to help offset the cost of covering millions of people now without coverage. Sen. Charles E. Schumer of New York, the Senate's No. 3 Democrat, said the Finance Committee - which is at work on its own legislation - could seek as much as $100 billion from the industry.
And Sen. John D. Rockefeller IV, a West Virginia Democrat, said, "The insurance companies are the people who are just rapaciously, greedily, unstoppably making money by underpaying the patient, underpaying the provider and by overpaying ... themselves."
Obama continued to lobby for Republican support, meeting privately Wednesday with a group of GOP senators that included Lisa Murkowski of Alaska, Bob Corker of Tennessee and Saxby Chambliss of Georgia.
But after months of stressing the need for negotiation, the president also hit back at critics for a second straight day, saying the public insurance option "would make health care more affordable by increasing competition, providing more choices and keeping insurance companies honest."
And the president's independent political operation upped the ante by launching television ads against members of his party who have expressed skepticism about his approach to health care.
On Wednesday, Organizing for America, a vestige of the formidable grass-roots operation that helped Obama win the 2008 election, began running a 30-second TV commercial in eight states that are home to such Democrats.
At a news conference, Sen. Ben Nelson, a Nebraska Democrat who has expressed worries about the public insurance option and is being targeted with the ads, brushed them off. "The ads won't affect me," he said. "It helps the broadcast industry."
Rep. Mike Ross, an Arkansas Democrat speaking for the New Democrat Coalition, said the group has enough votes to thwart action in the House Energy and Commerce Committee.
"A lot of this could have been avoided if they started listening to us three months ago," he said. Despite meetings with party leaders and a session with Obama on Monday, the bill "does not reflect many of our concerns," he said.
The Washington Post contributed to this article.