Hours before President Obama was set to deliver a make-or-break speech on health care reform, a top Senate negotiator conceded the government-run insurance program so dear to the president's supporters cannot pass the Senate.
Sen. Max Baucus, D-Mont., who was trying to hammer out the details of a bipartisan compromise Wednesday with five other senators, announced that he would be moving ahead with or without Republican support.
But he made clear that the so-called "public option" would not be part of any deal with his name on it.
"The public option cannot pass the Senate," Baucus said. "I could be wrong, but it's my belief that the public option cannot pass."
Obama, who will address a joint session of Congress at 8 p.m. ET Wednesday, has indicated he wants a public option and will press for it in his address, a senior adviser said. The senior official fought back against the perception that August was a tough month for Obama's health care agenda, but said the president did lose ground politically before the recess and can start regaining it Wednesday night.
Obama, though, so far has not said he will demand a public option. He also has not said he will veto a package that omits a government-run health insurance program.
Baucus' assessment Wednesday afternoon is the latest blow to die-hard supporters of a government plan.
Baucus, chairman of the Senate Finance Committee, has so far favored a system of non-profit cooperatives as an alternative to the "public option." A draft plan he outlined Tuesday included the co-ops. Baucus also said Wednesday that a so-called "trigger," which would keep a government plan on reserve in case private insurers don't meet certain benchmarks, has not been part of talks -- though many analysts consider a trigger a possible compromise.
The four partisan bills that have passed out of committee in the House and Senate include a public option.
Baucus said Wednesday he'll be moving forward, putting out a version of a bill next week with a mark-up scheduled for the week after that. He said he still wants and expects Republican support, but that the GOP will not hold him up.
"This is our moment. We've spent many weeks and months on this crucial issue, and now is the time to move forward," he said. "If there are not any (Republicans), I'm going to move forward in any event."
Baucus said earlier he wanted to have a deal to the president before the address, but even though the senators continued to meet that appeared less and less likely.
Watch President Obama's address to a joint session of Congress and the Republican response at 8 p.m. ET on FOX News Channel and FOXNews.com.
But others tried to take the pressure off the time clock. Sen. Kent Conrad, D-N.D., a member of the Gang of Six, said the group wouldn't have any great revelation.
"It isn't 'get it done by 2 o'clock or it's not going to happen.' That's just not the way it works," he said.
"There is a sense of urgency but that has to be counterbalanced by the task of getting it done right, not getting it done quickly," added Sen. Ben Nelson, D-Neb.
Obama has spent much of the summer trying to drive back criticism -- loudly on display at town hall meetings across the country -- about government-sponsored health care reforms. He has offered explanations for what the program will not do but so far has said little about what he will insist be in the legislation.
His supporters hope he will lay it all out in his address to Congress, which is expected to go about 35 minutes.
In an interview that aired Wednesday morning on ABC's "Good Morning America," the president said he doesn't want a package that will add one dime to the deficit nor does he plan to stand on ideology. For him, time is of the essence.
"I think what the country is going to know is exactly what I think will solve our health care crisis, they will have a lot of clarity about what I think is the best to move forward. So the intent of the speech is to A, make sure that the American people know exactly what it is we are proposing, B, to make sure that Democrats and Republicans understand that I am open to new ideas, that not being rigid and ideological, but we do intend to get something done this year," the president said.
But Senate Minority Leader Mitch McConnell said "the only thing bipartisan" about the legislative debate so far is the opposition. He proposed tort reform and changing the way medical malpractice suits are resolved. He said that insurance reforms, like intrastate competition, portability and no exclusions for pre-existing conditions were all areas where the two sides could "rally a broad bipartisan agreement."
Obama is hopeful that the committee "can get something done in a bipartisan way," Gibbs said.
"I think Senator Baucus has been working with this group of senators for almost a year on getting something out of the committee," Gibbs said. "So obviously we're hopeful that something can get done in that committee. That would obviously be an important milestone in this reform."
On Tuesday, Baucus circulated a proposal that would cost $900 billion over 10 years and guarantee coverage for nearly all Americans, regardless of medical problems. Fees on insurers, drug companies and others in the health care industry would finance tax credits to help expand coverage.
One provision would fine families up to $3,800 for failing to buy health insurance, essentially requiring that everyone have medical coverage, much like the case with car insurance. Obama rejected both a mandate and fines during his presidential campaign.
Gibbs said Congress is closer than ever to getting something done because the president let the committees write the final product rather than offering a plan of his own, a strategy that ensnared former President Bill Clinton's attempts for reform in 1993.
"I think if representatives and senators and the president listen to the American people, what they are telling them quite clearly is that we have to do something about health care. We have talked about this for decades," Gibbs said.
But concerns that the president isn't listening to the American people have Republicans wondering if compromise is within reach.
"I believe it would benefit the country more if Mr. Obama was coming to Capitol Hill to listen instead of to lobby for votes for a health care plan that will end up leading to rationed care, tax hikes and job losses. That's the message I heard from the 5,000 people who came to my town hall meetings in August, and it's a message the president needs to hear too," said Rep. Joe Barton, R-Texas, ranking member of the House Energy and Commerce Committee.
The president will have to contend with more than just conservative Republicans. If he demands a government-run system, he could lose fiscally moderate "Blue Dog" Democrats; if he does not insist on a government option, he may lose liberal Democrats.
"We will have a bill, it will be a good bill that will make sure that all Americans have access to affordable health care, and I believe it will have a public option," said Rep. Jan Schakowsky, D-Ill., a member of the House Energy and Commerce Committee.