WRAPUP 1-Obama cautiously optimistic on US healthcare bill

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* Obama says he is 'cautiously optimistic' on health bill

* Pivotal senator Lieberman says he's closer to backing it

* Senate in final push to pass overhaul by end of year

By John Whitesides and Donna Smith

WASHINGTON, Dec 15 (Reuters) - U.S. President Barack Obama pushed Senate Democrats on Tuesday to pass a broad healthcare overhaul and said he was cautiously optimistic they could agree on a bill that saves money and improves millions of lives.

"We are on the precipice of an achievement that has eluded Congresses and presidents for generations," he told reporters after a White House meeting with all 60 members of the Senate Democratic caucus.

"There are still disagreements that have to be ironed out. There is still work to be done in the next few days," Obama said of the effort to win Senate passage of his top domestic priority by the end of the year. "I'm feeling cautiously optimistic we can get this done."

The meeting came one day after Democrats said they likely would drop a compromise plan to expand the Medicare government health program for the elderly and disabled after Senator Joe Lieberman said he would join Republicans in blocking any bill with the plan. Lieberman is an independent who caucuses with Democrats and is a crucial vote for the overhaul.

The compromise was announced a week ago in an effort to overcome objections by moderates to a new government-run insurance program. Known as the "public option," it is intended to offer an alternative to private insurers to help keep down the cost of medical coverage.

A provision in the compromise that is expected to survive would replace the proposed public option with a non-profit coverage plan offered by private insurers and overseen by a federal agency.

Lieberman said on Tuesday he probably could back a healthcare bill that has no government-run insurance option and no Medicare "buy-in" proposal. That proposal would have allowed people ages 55 to 64 to buy Medicare insurance, which is available to all Americans at age 65.

'RIGHT DIRECTION'

"I'm getting toward that position where I can say what I've wanted to say all along -- that I'm ready to vote for healthcare reform," Lieberman told reporters. "I think we're heading in the right direction."

Lieberman's support would be a big step forward for Democrats, who have no margin for error.

They control exactly 60 of the 100 votes in the Senate -- exactly the number needed to overcome Republican procedural hurdles -- and could not afford to lose Lieberman or any other member in the face of unified Republican opposition.

Many other Senate Democrats, including potential defector Ben Nelson, are waiting for cost estimates on last week's proposed compromise before making final decisions.

Those estimates, from the non-partisan Congressional Budget Office, could be released later on Tuesday or on Wednesday.

The Senate is in its third week of debate on the measure, which would extend coverage to 30 million uninsured Americans and halt industry practices like refusing coverage to people with pre-existing medical conditions.

The United States spends more on healthcare than any other country. Healthcare costs devour 16 percent of the U.S. economy -- burdening states and the federal government while also hurting the competitiveness of U.S. businesses.

Obama has pushed the Senate to finish the bill this year to avoid the issue slipping into next year's congressional election campaigns.

The Senate bill would then be reconciled in early January with a version approved by the House of Representatives on Nov. 7, a process House Democratic leader Steny Hoyer said "will take some time." The House and Senate would then have to pass the new bill before sending it to Obama to sign into law.

To finish in the Senate by Christmas, Reid must file a series of procedural motions this week to cut off debate and move to a final series of votes.

(Additional reporting by Ross Colvin and Susan Heavey; Editing by Will Dunham)