In an effort to head off crippling medical costs to uninsured people and those with catastrophic illness or injury, Oregon's two U.S. senators are introducing a pilot program to plug the dike with federal money.

Called the Catastrophic Health Coverage Promotion Act, it would funnel $50 million to $100 million into four states, including Oregon, to create the pilot programs, Democratic Sen. Ron Wyden said at a news conference Thursday at Providence Medford Medical Center.

One approach offers a "hybrid health insurance" plan for uninsured people that combines a primary and preventive health benefit with high-deductible catastrophic coverage. It would be sold by private insurers to individuals or small businesses that have not offered coverage to employees for at least a year.

The other track helps people who have private insurance but are hit with costs over $10,500. (This threshold can be as little as $8,000, depending on the state's average costs.) The subsidy would be for those whose earnings are 200 percent above the federal poverty line: $19,600 for individuals and $33,200 for a family of three.

Republican Sen. Gordon Smith said the bill, to be introduced next week, has good prospects of passing because of bipartisan sponsorship and also because Oregon is "in a powerful place" as the only state with both senators sitting on the Senate Finance Committee, which will hear the bill.

"When you have both a Republican and a Democrat asking for a hearing, it gets a hearing," said Smith in an interview. He also cited his chairmanship of the Senate Committee on Aging as additional clout.

Smith added there may be opposition from the health insurance lobby because the bill may be seen as "too much intervention by government in health care." But Wyden noted that the bill offers a larger market for the industry, too.

The senators cited the huge burden of $500 million in medical costs incurred by 600,000 uninsured Oregonians, noting this has gone up 72 percent in the last decade — and must be passed along to paying customers.

In Jackson County, 20 percent, or 50,000 people, lack insurance, said Dr. John Jackson, medical director for Providence Medical Group. A fourth of emergency room patients at Providence Medford Medical Center are not covered, he said.

The key gap, Wyden noted, is among those with too much income to receive Medicaid — or who have exhausted that source — but not enough for insurance premiums.

"They get flattened with out-of-pocket costs and go to bed at night wondering if they're going to lose their homes and all they worked for — and when they get up they have nowhere to turn," he said.

The plan offers "reinsurance" to small businesses whose coverage can be overwhelmed if, for example, they employ six people and one has catastrophic medical bills, threatening to raise costs for the other workers, said Wyden. This is augmented with preventive care, he said.

The proposal is a voluntary, incremental approach, an attempt to "close the gap and get more people in the tent," Smith said, noting it would be designed and administered by state health departments.

"If you lose your health, you shouldn't lose your home. Our bill is a piece of the answer," Smith said. He noted that when he ran a company with 450 employees, there were always a couple each year who would have medical bills in the six figures and "it was so inexpensive to have catastrophic coverage."

Wyden said by the end of the year he will introduce legislation for "comprehensive, affordable, essential health care, to get everyone in the tent. This country is ready to join the ranks of the rest of the industrialized, Western world — and it wouldn't raise taxes. We already spend $1.7 trillion a year on health care."

A universal plan, he noted, would redirect that expenditure to "health care that works for all Americans."