WRAPUP 2-Obama says he's open to Republican healthcare ideas

(For full coverage of U.S. healthcare, click [nHEALTH])

* Obama tells Republicans he is exploring their ideas

* Democrats ready for healthcare push without Republicans

* Hoyer sees chance for new Democratic healthcare converts (Adds congressional reaction, stocks, details)

By John Whitesides and Donna Smith

WASHINGTON, March 2 (Reuters) - President Barack Obama said on Tuesday he would explore adding more Republican ideas to his healthcare plan, even as congressional Democrats prepared for a final push to pass the overhaul without Republican backing.

In a letter to congressional leaders from both parties, Obama said he was considering adding four ideas offered by Republicans last week at a day-long healthcare "summit" but did not agree with their demand for a more incremental approach.

Obama said he would explore ideas to probe healthcare providers who get federal money, to expand health savings accounts, to offer more grants to study alternatives to medical malpractice suits, and to boost doctor reimbursements for Medicaid, the federal health program for the poor. [ID:nN02167798]

"I said throughout this process that I'd continue to draw on the best ideas from both parties, and I'm open to these proposals in that spirit," Obama said in the letter.

He is expected to announce his plans on Wednesday for forging ahead with a revamp of the $2.5 trillion healthcare system and Democrats prepared to use a procedure called reconciliation that allows Senate approval by a simple majority vote. [ID:nN01110138]

That approach, which can be used only for budget-related measures, would bypass rules that require 60 votes to clear procedural hurdles in the 100-member Senate. Reconciliation needs only a simple Senate majority of 51 votes.

Republicans criticized Democrats for pushing ahead with healthcare bills they say the public does not want, and they cast doubt on Obama's willingness to work with them.

"If the president simply adds a couple of Republican solutions to a trillion dollar healthcare package that the American people don't support, it isn't bipartisanship -- it's political cover," said Eric Cantor, the No. 2 Republican in the House of Representatives.

Democrats in the Senate and House passed healthcare bills last year that would reshape the industry by cutting costs, regulating insurers and expanding coverage to tens of millions of Americans.

But efforts to merge the different measures and send a final version to Obama collapsed in January after Democrats lost their crucial 60th Senate seat in a special election in Massachusetts.

TWO-STEP PROCESS

Using reconciliation to pass the final healthcare bill would be a two-step process. The House would approve the Senate-passed bill and changes to the Senate bill sought by the House would be passed separately through reconciliation.

Many of those changes, such as adjustments to a tax on high-cost insurance plans and additional federal subsidies to make coverage more affordable, were incorporated in a proposal released by Obama last week.

He is expected to adjust that package as part of his announcement on Wednesday and his letter appeared to signal some of the additional Republican proposals he will add.

Investors seemed to shrug off any new momentum for passing healthcare legislation, with the Morgan Stanley Healthcare Payor index .HMO of health insurer stocks up about 1 percent late Tuesday.

Democrats still face a challenge in getting the bill through the House, which passed the overhaul with only three votes to spare last November. With elections approaching, Democrats are anxious to move past healthcare and talk about job creation and the economy.

House Democratic leader Steny Hoyer said he saw the possibility of gaining support for Obama's sweeping healthcare overhaul from Democrats who voted "no" when the House considered it in November. [ID:nN02158218]

"We're talking to everybody," Hoyer said. "Do I think there is a possibility of some people changing? Yes I do."

Hoyer said he was confident of winning more Democratic converts because "when bills change, members look at it somewhat differently."

Republicans have criticized any effort to use reconciliation on the healthcare bill, even though they have used it to pass bills at least 14 times since 1980.

"Democrats are saying they want a simple up-or-down vote on healthcare. What they really want is to jam their vision of healthcare through Congress over the objections of a public that they seem to think is too ill-informed to notice," Senate Republican leader Mitch McConnell said.

Republicans plan to raise many objections and offer a flood of amendments during the process, hoping to extend the debate and force Democrats into difficult votes ahead of November's election. (Additional reporting by Thomas Ferraro, Matt Spetalnick and Ross Colvin; Editing by David Alexander and Chris Wilson)