For months, liberal House Democrats had vowed to bring down a bill that didn’t include what they called a “robust— public insurance option. Speaker Nancy Pelosi (D-Calif.) just called their bluff — and they appear ready to fold.

The cratering resistance of liberals removes the gravest challenge to leaders as they prepare to rally support for a more moderate approach — one that allows the federal government to negotiate rates under the plan with health care providers instead of pegging them to Medicare. The stalemate on the issue had stymied the rollout of a final House package. But after a weeklong whip effort, Democratic leaders in the chamber have determined the robust plan falls far short of the support that it needs. They are planning a 10:30 a.m. press conference Thursday on the West Front of the Capitol to announce their bill and its estimated budget effect from the Congressional Budget Office.

Rep. Lynn Woolsey (D-Calif.), co-chairwoman of the Congressional Progressive Caucus, cautioned that her group has made no decisions about whether to support the more moderate approach pending a look at legislative language. But she echoed many others in her ranks when she signaled liberals are ready to claim victory on dragging the plan back from the dead and accept a compromise. “We will insist on making it as strong as it can possibly be,— she said, adding, “Give credit to the progressives and the robust public option group that have pulled this and pulled this and pulled this.—

Liberals for months have staked out a public plan tied to Medicare rates as their make-or-break priority in the health care debate. About 60 of them signed a letter over the summer pledging to vote down a bill that included anything less. They have argued that Medicare rates offer significant savings over negotiated rates — $85 billion more, according to the CBO — and provided the only real muscle to compete with private insurers.

Now, as leaders scramble to muster 218 votes for their health care overhaul, the question is how many liberals will actually balk and oppose a measure with negotiated rates — and how many moderates will climb aboard to help make up the difference. Leaders don’t know for sure: They only have firm whip counts on support for the liberal version. But Education and Labor Chairman George Miller (D-Calif.), a close ally of Pelosi, expressed cautious optimism Wednesday. “We think we’ll have the votes,— he said.

That assessment was shared by Rep. Raúl Grijalva (D-Ariz.), co-chairman of the Progressive Caucus, though he said he wasn’t sure yet about his own vote.

Leaders of the Progressive Caucus and the three ethnic caucuses are scheduled to discuss the issue Thursday in a meeting with President Barack Obama. Woolsey and Grijalva suggested they would use the White House session to focus on end game and press the president to insert himself more forcefully into the debate in favor of a public insurance option.

Grijalva said he wants the president to pledge “that he will defend a public option, that he will continue to protect the most vulnerable people, and more importantly, no triggers, none of that stuff.—

“You still have a rather flaccid thing coming out of the Senate, and so we’re always negotiating down,— Grijalva said.

But Democratic leaders, and some notable liberals, have made the case that Senate Majority Leader Harry Reid’s (D-Nev.) decision this week to try to forge ahead with a package that includes a public option relieves pressure on the House to produce a more liberal provision for negotiating leverage. Pelosi set the stage for that argument at a Friday press conference, noting that “the atmosphere has changed.—

“When we were dealing with the idea that the Senate would have nothing, it was really important, again, to go in with the most muscle for the middle class, with the robust public option,— she said Friday.

Other advocates of a robust public option have joined the Speaker since. “I think the issue is whether it’s going to have a public option or not,— Miller said. “I think that’s the test.—

Rep. Jerrold Nadler (D-N.Y.), an outspoken proponent of Medicare rates, rose in a Tuesday meeting of the Democratic Caucus to praise leaders for doing what they could to find the votes for the approach. “If it’s not going to be Medicare rates, I’m sorry,— he told reporters Wednesday. “But if we can’t, we can’t.—

Likewise, Rep. Jim McGovern (D-Mass.) said the point now is for his party to unite behind a bill that can pass. “I’m not looking for perfection. I’m not going through this debate for therapy,— he said. “What Progressives need to do is figure out what is the most robust, comprehensive bill that can pass. It does no good if it can’t pass.—

Leaders on Wednesday evening began presenting the bill to different groups within the Caucus ahead of the measure’s public debut Thursday.

Energy and Commerce Chairman Henry Waxman (D-Calif.), meanwhile, said the bill would also include a national insurance pool for the first few years for people with pre-existing conditions, before the national health insurance exchanges are set up. That is among several pieces of the bill that are being advanced so Democrats can claim an earlier victory.

But even with the question of the public insurance option apparently resolved, leaders face several knotty problems before bringing the measure to the floor for an expected vote as early as next week. Two social policy disputes — over abortion and immigration — have crept into the debate. And moderates may yet mount a challenge on the measure’s cost and budget effects, if the CBO flags them as concerns.