The final bill is expected to not add to the deficit, as new spending will be offset by a combination of cuts to existing programs and new taxes.
Some changes Reid is considering would require additional revenue. For instance, a proposal favored by Reid to scale back an excise tax on expensive health insurance plans would leave the bill as much as $30 billion short, according to one Senate aide.
In addition, Reid is expected to beef up subsidies in the bill for low-income and middle-income people to purchase health coverage.
The Medicare payroll tax increase being weighed by Reid "would be a progressive change, it would be targeting people who are most able to pay," said Steve Wamhoff, legislative director for the liberal group Citizens for Tax Justice.
The group in December proposed raising the employee share of the Medicare tax to 2.5% of wages, but also proposed applying the tax to capital gains income. The Medicare tax now only is levied on wages.
"While still an improvement, this proposal is not as advisable as the proposal we put forward on investment income," Wamhoff said. "The more you exacerbate the disparity between wage and investment income, the more you encourage people to hide their income as capital gains."
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