Gov. plans healthcare veto, talks - Schwarzenegger says he will reject a measure passed by Democrats and will call a special legislative session to seek a compromise.

Lawmakers also approved measures that would permit more routine testing for the virus that causes AIDS, make it easier for police to trace bullets to the guns that fired them and require fast-food restaurant chains to list the nutritional content of their menu items.

The Legislature is set to adjourn for the year as early as today, but in recent weeks Schwarzenegger and Democratic leaders have moved toward the outlines of a deal on healthcare.

An agreement would be likely to include a requirement that employers provide health coverage for workers or pay a fee to the state, which would then arrange for insurance for those workers. That proposal forms the heart of the Democratic bill.

The deal probably would also incorporate a tax on hospitals that would help California capture an extra $2 billion in federal aid. The California Hospital Assn. endorsed such a tax last week after Schwarzenegger lobbied hospital executives.

An accord may also include a state sales tax increase, an idea put forth last month by some business groups.

Democratic leaders have been engaged in talks with Schwarzenegger about their disagreements, including ways to make insurance affordable to all Californians.

"We have made tremendous progress on this issue during the past session and have found considerable common ground," Schwarzenegger said in a statement Monday announcing his plan to veto the Democratic bill, before it had passed the full Legislature. "That is why I intend to call a special session of the Legislature so that we can finish the job of truly reforming our healthcare system."

Some of the proposals would be approved in the special session, while others that cannot pass the Legislature without Republican support would be placed on the ballot next year for voters to decide.

The special session would allow lawmakers to act before the next legislative year begins in January. It also would have a public relations purpose -- to convey that work is continuing.

Democrats and labor allies hailed the passage of the proposal Monday as proof that the nearly nine-month-long session was not without progress.