WASHINGTON — Top New York state officials are considering splitting up bond insurers into two businesses, an overhaul that could protect more stable municipal policies while leaving borrowers of mortgage-backed securities and other debt to fend for themselves.

Testifying before a House subcommittee, Governor Spitzer and the state insurance superintendent, Eric Dinallo, said they hoped bond insurers would be able to raise sufficient capital in the coming days to prevent a potentially crippling downgrade in their credit ratings. But while Mr. Dinallo said a full government bailout of the industry “is not planned,” regulators are mulling an offer from Warren Buffet’s Berkshire Hathaway that would underwrite municipal bonds as part of a plan to separate bond insurers’ less risky securities from assets related to the subprime mortgage market. This will effectively split the bond insurers into two businesses, creating the possibility that those insurers left with just the riskiest assets will go bankrupt.

“It is time for people to act,” Mr. Spitzer told lawmakers, saying it was time “for deals to get done” that would allow insurer to raise needed capital. He said accepting Mr. Buffett’s offer was “not optimal” but may be necessary.

While the New York state insurance department plays a large role in regulating the bond insurance market, Mr. Spitzer placed much of the blame for the current crisis on the Bush administration and, in particular, the inaction of the Office of the Comptroller of the Currency, an entity he has targeted since his days as state attorney general.

Some lawmakers want to create a new federal corporation to oversee the municipal bond market, a proposal that Mr. Spitzer eyed warily. He expressed qualified support for duel regulation between Washington and the states, but he warned against the view that simply creating another federal entity would solve the problem. The governor also said states should retain some jurisdiction for regulating the industry.

“I would not agree to cede regulatory authority from the state exclusively to the federal government,” he said.

Mr. Spitzer was challenged by the ranking Republican on the House Financial Services Committee, Rep. Spencer Bachus of Alabama, who said the New York state insurance department should shoulder more of the blame for failing to recognize earlier the problems in the bond insurance market.

The accusation prompted a tense exchange, as the suddenly combative governor rose to the defense of Mr. Dinallo and squarely blamed the Bush administration. “Mr. Bachus, you are involved in a finger-pointing exercise,” Mr. Spitzer said.

At one point, the former prosecutor turned the tables entirely on Mr. Bachus when the congressman repeatedly criticized the state for approving dividend payments to bond insurers. “Do you think the superintendant should be in a position to suspend dividend payments to a publicly-traded company, sir? So we can do for General Motors, we can do so for Exxon?” Mr. Spitzer asked Mr. Bachus.

The congressman relented, but not before adding: “I’m just saying that if we’re to say what went wrong, the one entity that regulated, that was the regulator for the bond insurers was not the SEC. It was not the credit-rating agencies. I’m not absolving them. I’m just saying that if we are to resolve this problem in the future, if New York state is going to continue to regulate these entities, it is going to have to do a much better job.”