President Barack Obama said on Tuesday U.S. healthcare reform was closer than ever but there was still work to do as his top policy initiative, already rejected by Republicans, ran into trouble with his own Democrats.

Just before he was to meet with a group of Democratic lawmakers concerned over the roughly $1 trillion pricetag for the reform plan, Obama told reporters the country was close to revamping its $2.5 trillion healthcare industry.

But on Capitol Hill, House of Representatives Democratic leader Steny Hoyer said the complex plan had encountered problems from all directions, not just the fiscal conservatives known as Blue Dog Democrats.

I want to make it very clear that there's progressives, Blue Dogs and everybody in between who have expressed concerns and we're working on that, he said.

A key congressional panel canceled Tuesday's votes on its version of the legislation while talks continued with the seven Blue Dogs whose votes are essential to passage.

Another panel, the House Ways and Means Committee, said it would meet on Wednesday to look for new tax revenue as its original plan to add a tax on the wealthy was under fire. It would have raised about $544 billion over 10 years.

Earlier on Tuesday when asked on NBC's Today show whether he would sign any of the bills working through Congress, Obama said, Right now, they're not where they need to be.

But he said he was confident the final legislation would drive down spiraling healthcare costs over time -- fulfilling his repeated promises to come to grips with a problem which has flummoxed generations of U.S. politicians.

While Obama has been pushing Congress to land a healthcare bill on his desk by October, recently he has been saying he wants it by the end of the year, which would still lock in changes before lawmakers focus on the 2010 mid-term elections.

Representative Louise Slaughter, who chairs the House Rules Committee that sets the process for bringing bills to the floor, told reporters House leaders still planned to bring a healthcare bill to a vote next week, but added they might also be prepared to stay in session beyond the July 31 scheduled recess to keep working toward a deal.


The plan now working its way through Congress seeks to set up a government-run health insurance program to compete with private insurers, expand coverage to most of the 46 million uninsured, and hold down soaring healthcare costs.

House Energy and Commerce Committee Chairman Henry Waxman canceled Tuesday's session to go to the White House with panel's Democrats.

An aide to one of the fiscally conservative Blue Dog Democrats said the group might ask Obama to slow down the healthcare push. The landscape will change after that meeting, the aide said.

Blue Dogs are very concerned about the financial implications of bill. There's not enough reform made or cost-cutting, one Blue Dog source said.

The Blue Dogs account for 51 of the 256 Democrats in the House and for seven members of the committee -- enough in either case to defeat legislation if they vote with Republicans, who quickly latched on to the discord.

What we're seeing currently is a bipartisan majority has formed against the current proposal. ... Either this bill fails or it will change dramatically, Representative Eric Cantor, the second-ranking Republican in the House and a member of the Ways and Means Committee, told reporters.

Meanwhile, Obama was holding a second week of public appearances to drum up support for healthcare reform and is scheduled to hold a primetime news conference on Wednesday where healthcare was expected to be the focus.

The effort has the feel of a political campaign, relying on grass-roots organizations such as the Democratic National Committee's Organizing for America to go door-to-door, hold neighborhood meetings and contact lawmakers. Republicans in turn have launched their own public outreach effort.

Obama said again he would oppose taxing healthcare benefits, an idea that has been brought up in closed door meetings of the Senate Finance Committee. The panel's chairman, Max Baucus, said on Tuesday it was making significant headway after meeting for weeks to figure out ways to pay for healthcare overhaul.

While most Americans get health insurance coverage through their employer, small firms that do not provide it worry they would not be able to afford to meet a government mandate that they contribute to workers' insurance.

The National Governors' Association wrote lawmakers with concerns that Washington not shift more of the expenses for healthcare for the poor through the Medicaid program to the states.