The governor's health-coverage plan, his priority in the current session, debuted before a legislative committee Wednesday to mixed reviews.

Some business leaders and health care plans and providers praised it as a big step toward reforming a system under which 400,000 New Mexicans remain uninsured.

"Forty percent of our patients and clients have no coverage at all," said Larry Lyons, vice president of clinical affairs for Presbyterian Medical Services, which has health care sites around the state, many in rural areas.

Critics, however, told the House Health and Government Affairs Committee the plan goes too far — or not far enough.

Paying into a fund to help finance universal coverage would be too burdensome, restaurant owners said.

Other opponents complained the plan would prop up insurance companies, swamp an understaffed health-delivery system and not improve health care or curb costs.

Some also criticized the governor's proposed control of the system: He would effectively appoint the authority that runs it.

Rep. Jeannette Wallace, R-Los Alamos, said the authority's power to decide how much businesses should pay into the fund "scares me to death," and the Legislature ought to have more say. "I wish we had more time to look at it," Wallace also said.

The committee delayed a vote on the bill until at least Saturday. By then, it will have heard competing proposals — one a cooperative-type system that relegates insurance companies to a secondary role and another the creation of an independent authority to spend a year planning reforms.

Republican lawmaker Justine Fox-Young of Albuquerque alleged Democratic Gov. Bill Richardson's administration is "extorting support" for the bill from health care plans with its timing of awarding contracts.

"Ridiculous," replied Human Services Secretary Pam Hyde. "The processes are completely separate."

About $1 billion in contracts for providing services to Medicaid patients is pending.

Human Services Department officials said because of purchasing rules, the agency couldn't disclose whether the four prospective bidders are the same four companies that currently have contracts and that testified Wednesday on behalf of the governor's bill.

Awarding the contracts could have waited a year, but the department decided to do it earlier so as not to overtax the staff, Hyde told the committee. The contracts are scheduled to be awarded by the end of April.

Among the current contractors testifying Wednesday was Presbyterian Healthcare Services System — a different company from Presbyterian Medical Services. Diane Fisher, senior vice president for legal services for Presbyterian Healthcare, said the governor's plan strikes a good balance between private and public efforts and is "a very strong step toward health care reform."

Richardson's plan "is a coverage plan, not a health plan ... using the present insurance infrastructure, not destroying it," said Rep. John Heaton, D-Carlsbad, the bill's sponsor.

It would combine expanded government programs with private insurance. New Mexicans would be required to show proof of insurance when getting driver's licenses or other professional licenses, enrolling in school, starting a job, or paying income taxes. There are no penalties in the bill; they would be recommended later.

Employers as of 2010 would have to contribute up to $500 a year for each full-time worker, although that requirement could be reduced or eliminated if the employer were providing health coverage.

An 11-member Health Coverage Authority would run the system, consolidating existing bureaucracies to reduce administrative costs.

The governor's plan also includes insurance reforms aimed at containing health care costs.

It has the support of the Greater Albuquerque Chamber of Commerce, although another business group, the Association of Commerce and Industry, objected it was too burdensome to small employers.