WRAPUP 4-More delays for Obama's healthcare overhaul

(For a TAKE A LOOK on healthcare, click on [nN07323916])

* House leaders: probably no vote next week on health bill

* Senate Democrats meet with Obama

* Disputes on bill's size and scope divide Congress (Recasts, adds Hoyer, Republicans, details)

By Susan Cornwell and Kim Dixon

WASHINGTON, July 24 (Reuters) - President Barack Obama's drive to overhaul the U.S. healthcare system plunged into disarray on Friday when a group of Democratic fiscal conservatives said talks fell apart, dimming chances for quick passage.

House Democratic leader Steny Hoyer told the chamber there was only a "very small" chance the House of Representatives would vote next week on the sweeping $1 trillion reform plan, the centerpiece of Obama's legislative agenda.

Other Democratic lawmakers had said were ready to risk a vote next week even without the conservative bloc on board. If that gambit succeeds, they could leave for the August break having at least some movement on the legislation.

Democratic conservatives have joined Republicans in objecting to the size, scope and expense of the overhaul plan, presenting Obama and party leaders with a major political challenge as they seek to push the proposal through.

"They should scrap it, and work with us on a bipartisan better solution," House Republican leader John Boehner said.

In the Senate, Democratic leaders have already conceded they will not debate the full proposal until September. The confusion in the House raised fresh prospects of delay.

Representative Mike Ross, leader of the conservative House Democratic group, told reporters that "after over a week of very intense and what I believe to be good faith negotiations ... it pretty much fell apart this afternoon."

Despite personal appeals this week from Obama and hours of negotiations with Democratic leaders and White House staff, the conservatives, known as "Blue Dogs," said their concerns about containing medical costs had not been resolved.

Earlier on Friday, Obama's chief of staff, Rahm Emanuel, shrugged off the delays in the House and Senate and said a sweeping healthcare plan to to control costs and expand coverage would still be approved by year's end.

The final bills are expected to include some form of public insurance plan to compete with private insurers and help cover most of the 46 million Americans without insurance.

Obama has described healthcare reform as essential to long-term U.S. economic viability and had asked the Senate and House to pass initial versions before leaving for the summer recess to help keep opposition from building.

Senate Majority Leader Harry Reid and Senate Finance Committee Chairman Max Baucus met with Obama on Friday on problems with the legislation in that chamber. The Senate plans to vote on its version in September.

Obama has staked significant political capital on the passage of a healthcare bill this year before lawmakers turn their focus to 2010 midterm elections.

BYPASSING CRITICS?

House Democratic leaders had made what Energy and Commerce Committee Chairman Henry Waxman called a "significant" offer to help hold down spending growth in the massive Medicare program for the elderly.

Waxman had said he would let the full House take the unusual step of bypassing his panel if the Democratic-led committee could not reach agreement. Without the seven fiscal conservatives, Waxman does not have enough votes to overcome Republican opposition on his panel.

House Speaker Nancy Pelosi has said she is confident Democrats have enough votes to pass the measure through the full House -- although others are not so sure.

The plan offered by Waxman and others addressed an issue important to many lawmakers: the rules in the Medicare health program that give some states a much larger share than others in the approximately $450 billion annual government Medicare spending. Medicare accounts for almost one-fifth of U.S. health spending.

"I think what we gained this morning was a lot of votes, a lot of people who were withholding support because this was so important to them," Representative Robert Andrews said.

But Ross later told reporters the talks fell apart after Waxman took off the table a proposal on details of the government-run health insurance and on a commission to review Medicare spending.

Speaking of ways to control costs, which has become a central sticking point on the plan, Emanuel said in an interview with National Public Radio aired early on Friday that the White House was urging Congress to include a proposal for an outside commission on healthcare cost-cutting.

"If you want to control costs, one of the things the president talked about is to have a group of health experts to ensure that, in fact, the changes that are necessary to the system so the system is more efficient, more cost effective, are done," he said. (Additional reporting by Donna Smith, Richard Cowan and Thomas Ferraro, Writing by Jackie Frank; Editing by Peter Cooney)