Speaker of the House Nancy Pelosi and Senate Majority Leader Harry Reid (D-NV) speak about their meeting between Congressional leadership and President Barack Obama on Afghanistan and Pakistan at the White House in Washington, October 6, 2009. REUTERS/Jim Young

Democratic leaders in the U.S. House of Representatives released a healthcare reform bill on Thursday that includes a government-run insurance plan and imposes a tax on the wealthiest Americans to help pay for it.

Democrats said the nonpartisan Congressional Budget Office estimated that the bill would cost $894 billion over 10 years -- below President Barack Obama's target of $900 billion -- and reduce the deficit by $30 billion over the same period.

Obama welcomed the House legislation, saying it would benefit millions of small businesses.

The measure, the product of weeks of closed-door talks to merge three pending health bills in the House, will be submitted to the full House for debate as early as next week. The Senate is considering its own version of healthcare reform bill.

The bill is fiscally sound, will not add one dime to the deficit as it expands coverage, implements key insurance reforms and promotes prevention and wellness across the health system, House Speaker Nancy Pelosi said in a ceremony to unveil the bill on the steps of the U.S. Capitol.

The proposed new government-run public insurance option, a flashpoint in the debate over Obama's top domestic priority, uses reimbursement rates negotiated with doctors and hospitals, a setback for House liberals led by Pelosi who wanted a stronger version to compete with insurers.

Pelosi failed to gain the 218 votes needed to pass a version of the government-run plan using lower rates pegged to Medicare, the government's health insurance program for the elderly, and could face resistance from liberals who preferred this plan.

The healthcare measure being prepared for debate in the Senate also includes a public insurance option based on negotiated reimbursement rates, but unlike the House bill it would allow states to decline to participate.

The House version of the healthcare overhaul would require individuals to buy insurance and all but the smallest employers to offer health coverage to workers.

It would offer subsidies to help uninsured people purchase insurance through newly created exchanges, and would expand eligibility for the government's Medicaid health insurance program for the poor to people with incomes up to 150 percent of the official poverty level.

The House bill includes a 5.4 percent surtax on individuals making more than $500,000 and couples earning more than $1 million, which an aide said would bring in about $460 billion over 10 years to help pay for covering the uninsured.

The bill also would eliminate the antitrust exemption for the insurance industry.