WASHINGTON - Public support for President Barack Obama's healthcare reform is waning, polls showed on Thursday as Congress wrangles over how to overhaul an industry that accounts for one-sixth of the U.S. economy.

After reaching a deal with conservative Democrats, the House of Representatives Energy and Commerce Committee -- the last of three House panels to vote on healthcare reform -- begins debate with final passage expected on Friday.

On the Senate side, the Finance Committee pushed forward with negotiations over how to pay for Obama's top legislative priority.

One of the six senators involved in the Finance Committee negotiations said on Thursday that new health cooperatives proposed under its version of the legislation could insure 12 million of the 46 million uninsured Americans.

The leading actuaries in the country tell us this cooperative model can secure 12 million members very quickly and be the third-largest insurer in the country, Democrat Kent Conrad told the NPR radio network.

So we have lots of reasons to believe this will be a successful competitor to private insurance firms, he said.

Conrad is one of three Democrats and three Republicans in the Finance Committee who have zeroed in on a plan that would use the non-profit cooperatives to compete with private insurers to drive down costs.

A government-run insurance program, favored by Obama and many of his fellow Democrats but resisted by Republicans and the insurance industry, would not pass in the Senate, Conrad said.

DOUBTS AND WORRIES

Since taking office six months ago, Obama has made an overhaul of the costly U.S. healthcare care system his main goal and he has personally pressed hard for passage, both with lawmakers and at campaign-style stops with voters.

But as congressional discussions drag on, more Americans are voicing doubt over the reform plan, with many worried that a costly overhaul could reduce the quality of their care and limit choices of doctors.

A New York Times/CBS News poll showed 69 percent of Americans were concerned their care would suffer if they were on a government-run plan.

A Wall Street Journal/NBC News poll showed 42 percent of those surveyed in July thought Obama's healthcare plan was a bad idea, up from 32 percent in June. The poll showed only two in 10 people thought the quality of their care would improve under the Obama plan.

Obama said on Wednesday critics were misleading Americans.

First of all, nobody is talking about some government takeover of healthcare, he said at a healthcare discussion in Raleigh, North Carolina. I'm tired of hearing that.

Under the reform I've proposed, if you like your doctor, you keep your doctor. If you like your healthcare plan, you keep your healthcare plan. These folks need to stop scaring everybody. he said.
Both chambers are expected to vote on draft bills after their August recess. They will then negotiate a joint bill that Obama hopes to sign into law this year.

(Additional reporting by Steve Holland; writing by Deborah Charles; editing by Eric Beech)

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