CNN

WASHINGTON (CNN) - The Senate Finance Committee has crafted a health care reform bill that is less than $1 trillion, Finance Committee Chairman Max Baucus, D-Montana, announced Thursday.

The bill is paid for through a combination of tax increases and various savings.

The Congressional Budget Office (CBO) has also assessed various policy options the committee can choose from in order meet that politically important price point, Baucus added.

Finance committee members were shocked last week when the CBO determined that their reform bill would cost $1.6 trillion. They have slowly whittled it down since.

Senators still have to make a number of decisions regarding which policy options they will choose in order to make up a comprehensive reform package.

–CNN's Ted Barrett contributed to this report