Congressional Democrats steered their landmark health care overhaul back from the brink Wednesday by notching breakthroughs in both chambers, but the package still faces a long and bumpy ride to passage.

House leaders who have struggled for weeks to bring fiscally conservative Blue Dog Democrats on board announced a deal paving the way to get the bill through the Energy and Commerce Committee, but not to the floor, before the August break. But the agreement ran into a firestorm of resistance from liberal Members, forcing Chairman Henry Waxman (D-Calif.) to postpone plans for a markup Wednesday afternoon.

Waxman later reached an agreement with members of his committee and announced he would go ahead with the markup Thursday morning.

Waxman’s deal with four Energy and Commerce Blue Dogs, backed by House leaders and the White House, cuts more than $100 billion from the bill, prevents a new public option from using Medicare rates to reimburse providers and exempts small businesses with payrolls of less than $500,000 from a new employer mandate, among other changes.

The weakening of the public insurance option incensed some liberal Members, with Congressional Progressive Caucus Co-Chairwoman Lynn Woolsey (D-Calif.) declaring she would vote against the bill.

More resistance came from within the Blue Dog Coalition itself, with some in the 52-member bloc saying the plan still costs too much.

The jarring and chaotic progress was mirrored on the Senate side, where moments after Finance Chairman Max Baucus (D-Mont.) touted a new score from the Congressional Budget Office for a bipartisan package he is crafting, Republicans on his panel declared the deal was far from done.

[IMGCAP(1)]And not unlike Waxman, Baucus has his own troubles with committee Democrats who continue to be unhappy with the direction of his bipartisan talks. Baucus has led a group of six Finance Committee negotiators — three Democrats and three Republicans — to craft a consensus.

“This bill needs to work for the average American, and I’m not sure we’re there yet,— said Senate Finance Subcommittee on Health Care Chairman Jay Rockefeller (D-W.Va.), who just last week got into a heated back-and-forth with Baucus and fellow Democratic negotiator Sen. Kent Conrad (N.D.) on the direction of the talks.

Baucus told reporters that the deal he is putting together had received a CBO score of $900 billion over 10 years. The CBO said the bill would insure 95 percent of all Americans by 2015, be deficit-neutral and actually reduce the deficit by several billion dollars in the 10th year.

But Rockefeller indicated that the score Baucus got Tuesday night was inconsequential if the policy prescriptions aren’t right.

“It doesn’t make a difference to me,— Rockefeller said of the score, which was released without accompanying documents showing the details of what Senate Finance negotiators are considering.

House Democratic leaders were working furiously late Wednesday to salvage their health care deal. Waxman said he still hoped to at least get a bill through Energy and Commerce before adjourning for the break, a scaled-back victory given that they originally hoped the full House would pass a bill by the recess.

Leaders of the Progressive Caucus indicated they would rally their ranks to bring down any package that hewed too closely to the moderate Blue Dog compromise. “We have not only concerns but outright opposition— to some of the provisions in that deal, said Rep. Raúl Grijalva (D-Ariz.), a co-chairman of the Progressive Caucus.

The weakening of the public insurance option in particular incensed liberals.

“It has to be much stronger to get our support,— Woolsey said after a meeting with Speaker Nancy Pelosi (D-Calif.), who tried in a meeting Wednesday to sell them on the deal.

Woolsey said progressives fear that without basing health care reimbursements on Medicare rates, the public option will not be able to hold down costs and force savings from private insurance companies. She said that was “great for the insurance companies— and would allow them to keep doing business as usual.

Members of the Progressive Caucus and the TriCaucus — the Congressional Black Caucus, the Congressional Hispanic Caucus and the Congressional Asian Pacific American Caucus — were meeting at press time to discuss what to do next.

It was not immediately clear how deep opposition ran among liberals, as some sounded hopeful about steering the package back to the left as House Democrats merge three bills over the August recess.

“I believe in happy endings,— said Rep. Jim McGovern (D-Mass.), a prominent progressive and member of the Rules Committee. He said the Blue Dog deal gives him “indigestion, but we need to keep kicking the can down the road.—

Others framed their choice as between a watered-down overhaul or no reform at all. Rep. Emanuel Cleaver (D-Mo.), a progressive and a Congressional Black Caucus member, said House Democrats from different factions need to give each other “a chance to become comfortable.—

“I don’t know anybody in the CBC who is jumping up and down, saying this legislation has reached nirvana status,— he said. “But if we don’t do health care reform now, it may be another decade.—

The deal itself came after intense meetings for two weeks between House leaders, White House Chief of Staff Rahm Emanuel, the Blue Dogs and Waxman, with marathon talks stretching throughout Tuesday. At times, the negotiations devolved into name-calling and appeared all but dead, only to be resurrected again.

But by Wednesday, four of the seven Blue Dogs on Energy and Commerce who had been holding up the bill — health care task force Chairman Mike Ross (Ark.), Blue Dog Co-Chairman Baron Hill (Ind.), and Reps. Zack Space (Ohio) and Bart Gordon (Tenn.) — had agreed to the terms of a package.

The agreement not to base the public insurance option on Medicare rates would save rural hospitals that might otherwise have to shutter, said Ross, the Blue Dogs’ lead negotiator. The public plan will have to negotiate rates with providers just like private insurance companies do, ensuring a level playing field, he said.

And the deal received the blessing of Obama, who put out a statement thanking the Blue Dogs.

“I’m especially grateful that so many Members, including some Blue Dogs on the Energy and Commerce Committee, are working so hard to find common ground,— he said. “Those efforts are extraordinarily constructive in strengthening this legislation and bringing down its cost.—

In the Senate, the six bipartisan negotiators continued to inch forward on a deal, although the extent to which such an agreement would be embraced by the full panel remained unclear.

In somewhat of a pre-emptive strike, Senate Republican Conference Chairman Lamar Alexander (Tenn.) and Sen. Orrin Hatch (R-Utah), a former participant in the bipartisan Finance discussions, cautioned that a deal does not automatically constitute a broader agreement on health care reform.

Among Democrats, Senate Majority Leader Harry Reid (Nev.) was already looking ahead to the planned merger of the forthcoming Finance bill and legislation reported out of the Health, Education, Labor and Pensions Committee on a party-line vote. And even Democrats opposed to major elements of the budding Finance legislation were hoping for a deal there to end the legislative logjam and generate momentum toward a final health care bill.

“We got to get this thing put together. We’ve got to start moving ahead,— said Sen. Tom Harkin (D-Iowa), a HELP member and a major player in the drafting of that committee’s health care reform bill.

Leading Republicans countered, saying there should be no rush to reach a deal and mark up legislation in advance of the August recess, scheduled to begin in that chamber Aug. 7.

“I’m on the [Finance] Committee and they’re not sharing with me. This is Wednesday, the week before we leave, and if you don’t have something pretty well nailed down by now, you’re not going to have a product available for markup,— Senate Minority Whip Jon Kyl (R-Ariz.) said. “Language hasn’t even been finally scored because they haven’t put it into legislative language yet.—

Sen. Mike Enzi (Wyo.), one of the three Republicans in the bipartisan negotiating group, emphasized repeatedly Wednesday that progress was being made, but he cautioned that a final deal was a long way off. Even Finance ranking member Chuck Grassley (R-Iowa), another participant in the negotiations, warned that many key policy items remain unresolved.

Still, Baucus was upbeat and optimistic that a deal was within reach, even as he conceded that the outstanding issues are “serious and real.—

“There’s momentum. We’re working,— Baucus said. “But you never know. In this process, something might happen that … forces everything to a big halt — a big stop. I don’t see that. I just know that nothing’s agreed to until everything’s agreed to. We just don’t know yet.—

Tory Newmyer, Emily Pierce and Jackie Kucinich contributed to this report.