SACRAMNENTO -- A spokesman for Assembly Speaker Fabian Nunez says Democratic leaders have agreed to key elements of Governor Arnold Schwarzenegger's health care reform plan, including mandatory insurance.

They embraced the idea while demanding some exemptions for people who are in financial trouble. Public programs also would expand to cover families earning up to 300 percent of the federal poverty level -- about $62,000 a year for a family of four.

Democrats also lowered the minimum amount employers must spend from their previous health care bill, which Schwarzenegger vetoed.

The new plan has a sliding scale for employers, with a maximum contribution of 6 percent. Spokesman Steve Maviglio says it also raises the tobacco tax by $2 a pack and imposes a tax on hospitals.